Legitimacy Theory and Corporate Sustainability Reporting: A Case Study of Consulting Firms in Chicago

• In Event: 50620 - Section on Environmental Sociology Roundtables
  In Refereed Roundtable (60 minute): Table 1: Corporate Power and Strategy Amid Environmental Problems

Abstract

This paper explores the common corporate sustainability reporting trends, focusing on Chicago consulting firms. Sustainability reports from ten consulting firms were analyzed using content analysis, identifying recurring themes that emerged consistently across different companies and industry sectors despite their varying fields of operation. Building on the legitimacy theory, I argue that corporations gain legitimacy by adhering to established sustainability trends to foster relationships with communities and stakeholders through sustainability reporting. Through analysis, I found that common environmental outcomes included reducing carbon footprints and transitioning to nature-based solutions. In the social dimension, reports frequently highlighted outcomes that involved community engagement, fostering a sense of belonging, and providing COVID-19-related support. For governance, recurring themes centered on ensuring human rights and supporting cooperative initiatives. Interestingly, less than a quarter of companies—mostly high profile—aligned their sustainability targets and outcomes with the Sustainable Development Goals (SDGs) by explicitly highlighting their contributions to each goal. These findings align with legitimacy theory, indicating that corporations utilize sustainability reporting as a tool to establish legitimacy. The recurrence of common themes across different sectors suggests a shared focus on similar issues, regardless of the specific frameworks employed. The question of lack of standardization and greenwashing still remains unanswered.

Author

• Dikshya Dahal, Loyola University-Chicago