Corporate Sustainability Reporting as a Driver of Financial Performance: Evidence from Public and Private Sector Firms in India

Abstract

The present study examines the reporting of sustainability activities of Indian firms, drivers of reporting and impact of sustainability disclosures on financial performance. It also investigates the reporting behaviour of public and private sector organizations to reveal marked differences. It considers 30 companies (15 public, 15 private) over 10 years (2015-2025). Company reports are analyzed content-wise to develop a sustainability disclosure index based on Daub’s framework. The relationship between disclosure quality and performance is studied using descriptive statistics, correlation tests and regression methods. Results show that private firms disclose more than public firms. Firm size, age, profitability and enterprise value are found to strongly influence reporting quality, while sales and foreign ownership have only a limited effect. Additionally, the study confirms that the better quality of sustainability reporting is positively associated with profitability (ROA, ROCE), shareholder returns (EPS) and firm value, reinforcing not only financial outcomes but also stakeholder trust. The paper offers Indian context-based evidence to show that sustainability reporting is not a matter of compliance only but also a business value driver. The public-private comparison offers new insights into the role played by firm characteristics in shaping reporting practices in emerging markets. The findings suggest that public sector companies need to improve level and quality of disclosures. Such insights can allow regulators to promote more standardized and transparent practices, while managers may see sustainability reporting as a strategic tool to attract investment, improve reputation and ensure long-term growth.