STUDY OF IMPACT OF CORPORATE SUSTAINABILITY REPORTING ON

EMPLOYEE PERFORMANCE AND ORGANIZATIONAL BEHAVIOR

Prof. Mrs. Vishakha K. Waikar Assistant Professor, Ashoka Business School

vishakha.waikar@gmail.com

Mr. Onkar Manchanda Student, Ashoka Business School onkarm.222@gmail.com

Abstract:

Keywords: Sustainability Reporting, CSR, Organizational Behavior, Employee Performance, Sustainability

Parameters

Introduction:

Organizations have come a long way; and have evolved from being profit centric to people centric over the last century.
The evolution which started with understanding functions of people in an organization and how people get motivated; has
charted a path to understanding how different concepts and entities like Emotional Intelligence, Perceptions,
Developmental and Training interventions etc. play a huge role in changing behaviors and performances. Organizations
have understood and accepted that each move they make; be it formulating business strategies or underlining budget
limitations; has a direct impact on behavioral aspects of human resources. One such evolutionary trend which is
gathering pace very quickly today is Corporate Sustainability Reporting.

Although the Corporate Sustainability Reporting scene in India is quite at a nascent stage; the number of companies
reporting their CSR and Sustainability data has increased from 40 (as in 2011 according to a KPMG report by Mr. Arvind
Sharma; Director Climate Change and Sustainability Services KPMG) has increased to 214 companies according to an
IIM Udaipur report of 2015. The major sectors contributing to sustainability reporting as per this 2015 report are Energy,
Information Technology, Telecommunication, Healthcare, Utilities, Capital Goods, Consumer Discretionary, Consumer
Staples, Diversified and Financials. It also finds though that sustainability scores for these companies is as low as 39%
and concentration happens mainly only on sustainability of products/services and internal operations.

Another 2011 study by Eccles, Ioannou&Serafeim identifies how sustainability reporting is impacting overall corporate
behavior and performance. This study dealt with how governance structures of firms reporting on sustainability are
different from others and whether there are specific measures taken for stakeholder engagement. This study sparks an
interest in understanding that indeed a culture of sustainability; if embedded correctly in an organization will result in
good stakeholder engagement.

A study closer home; conducted by Daizy&Niladri Das in 2015 looks at the trend of sustainability reporting in Indian
Mining Companies as per the GRI framework. GRI (stands for Global Reporting Initiative) sustainability reporting
framework guides companies on how sustainability parameters should be disclosed. The guidelines set forth 84 indicators
of sustainability categorized in 3 major parts; viz- economic which has 9 indicators, social with 45 indicators and 30
indicators for environment. Sustainability reporting in India has been happening voluntarily since 2001 and in 2011 the
Government has released the National Voluntary Guidelines constituting 9 core principles of business responsibility and
48 core elements within these principles. These 9 core principles are:

1. Ethics, Transparency and Accountability

2. Products Life Cycle Sustainability
3. Employees Well Being
 4. Stakeholder Engagement
5. Human Rights
6. Environment
7. Policy Advocacy
8. Inclusive Growth
9. Customer Value

The study found that out of 53 private sector companies only 18 private companies disclosed information according to
the GRI framework and out of 47 public sector companies only 23 disclosed information according to the GRI
guidelines.

PD Jose and Saurabh Saraf, IIM B took up around 100 companies to study their Corporate Sustainability Initiatives (CSI)
where they found that cement, electric utilities, mining, metals and the IT sector were far better than other sectors in
terms of reporting whereas disclosures on CSR spending were nonexistent in almost all companies. Only 20 40 %
companies reported on issues like Renewable energy, Health & Safety, Climate Change initiatives, Culture conservation,
disaster relief, greening supply chain and CR Finances & Donations and Sponsorships.

Although there is a lot of research available on how much information companies are disclosing; and what framework is
being used; there is no research found on whether there seems to be an impact of sustainability practices on employee
performance and organizational behavior. The need to understand how these practices impact the very stakeholder who
carries them out makes an interesting study.

For this study; 3 companies were selected from Nasik based on their being named amongst the top companies for
sustainability reporting. These companies (Coca Cola, Bosch and Mahindra Ltd.) have ranked amongst top 10 in
rankings given by an IIM Udaipur study. A 2 questionnaire study was conducted to identify how employee performance
practices were being carried out and what model of organizational behavior was followed in these companies.

The organizational behavior questionnaire aims to find out whether the overall behavior model in a particular
organization was Autocratic, Custodial, Supportive or Collegial. This would help us understand whether what these
companies mention in their reports is consistent with the actual research carried out at the location.

A ranking methodology was created for these 3 companies; based on the 9 core principles of the National Voluntary
Guidelines; and the sustainability reports were studied to rate inclusion of these principles in their reports. Rating 1 was
given for inclusion of each principle and 0 for exclusion. In all a rating out of 9 was given to each company.

Research Methodology:

The research is a descriptive and exploratory research using both primary and secondary data.

The sampling method used is Simple Random Sampling. This was done to get random employees to fill the questionnaire
enabling us to cover people at all managerial/executive/worker levels. This would in turn help to understand if
perceptions about a particular question differ at employee levels.

A sample of 35 people each was selected randomly from 3 companies giving us a total of 100 samples.

Analysis is done on basis of following parameters

Percentage Analysis for responses to each question

Scoring parameters for all 3 companies based on reports of companies.

Data Analysis and Interpretation: