Assessing the Relationship Between Corporate Sustainability Reporting and Firm Performance - A Study of Norwegian Companies in Light of the CSRD Directive

Abstract

This master's thesis examines the impact of readiness for the forthcoming EU Corporate Sustainability Reporting Directive (CSRD) on the firm performance of Norwegian companies. Our mixed-method approach combines quantitative and qualitative analysis to explore the extent to which firm performance is affected by their preparedness for the directive. Our findings reveal a lack of opportunities for companies to benefit from high- quality reporting, highlighting the need for legislation to promote sustainable reporting practices. Notably, our remote analysis indicates no significant relationship between CSRD and stock return. However, our study introduces a novel method for assessing the quality of sustainability reports relative to the directive, which will be even more applicable once it is fully implemented. This research contributes to the ongoing debate about the effectiveness of sustainability reporting in promoting transparency and accountability in corporate sustainability practices and its impact on financial performance.