An Analysis of Dow 30 Global Core Indicator Disclosures and Environmental, Social, and Governance‐Related Ratings

27 Pages Posted: 7 Oct 2020

See all articles by Christopher Calvin

Christopher Calvin

University of Dayton

Donna L. Street

University of Dayton - Accounting

Date Written: October 2020

Abstract

We examine the extent to which US Dow 30 companies disclose the Global Core Indicators (GCIs), which are measures to assess companies’ contribution toward the United Nation’s 2030 Agenda for Sustainable Development. We find that the Dow 30 are generally compliant with disclosing GCIs that align with US capital market reporting expectations, high‐profile current events, and issues that are financially relevant. We also find the Dow 30 are more likely to disclose institutional and economic issues, rather than environmental and social issues, and note disclosure variation across industries in which the Dow 30 operate. Supplemental analyses indicate that GCI disclosure levels are generally higher when those GCIs are associated with financially relevant ESG issues, suggesting companies are more amenable to addressing sustainability when doing so aligns with their mandate to shareholders. Correlation analyses reveal that the GCI indices moderately or strongly correlate with two of three MSCI sustainability ratings, highlighting companies’ focus on financially relevant areas, and weakly correlate with companies’ CDP climate change ratings, highlighting the limited scope of the GCIs in capturing detailed environmentally focused sustainability efforts. We also show that the MSCI sustainability ratings of the Dow 30 have generally trended higher over time, with increases driven by companies in the manufacturing, financial, and retail industries. Our findings help fill a void in sustainability literature on US company reporting of the GCIs and may be informative to the United Nations Conference on Trade and Development as it reviews the GCIs in support of the 2030 Agenda.

Suggested Citation

Calvin, Christopher and Street, Donna L., An Analysis of Dow 30 Global Core Indicator Disclosures and Environmental, Social, and Governance‐Related Ratings (October 2020). Journal of International Financial Management & Accounting, Vol. 31, Issue 3, pp. 323-349, 2020, Available at SSRN: https://ssrn.com/abstract=3705410 or http://dx.doi.org/10.1111/jifm.12123

Donna L. Street

University of Dayton - Accounting ( email )

Dayton, OH 45469
United States

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