Abstract
Undoubtedly, climate change is one of the greatest problems facing today’s world. Despite this, traditional research has ignored the market response to, and accountability for, climate change reporting in developing countries. Hence, this study critically examines climate change reporting practices in the most affected countries in the world, with specific reference to Bangladesh. In the study, 32 semi-structured interviews and 71 annual reports are evaluated. Using legitimacy theory, the study contributes to building an understanding of companies’ attitude toward stakeholder accountability regarding climate change. The study finds that Bangladeshi companies are reporting climate change information on an average of 2.23 %. More specifically, the study demonstrates that large companies are reporting on more climate change issues than others because of their legitimized positions in the market. Again, a lack of regulation and a culture of low social accountability among the companies contribute to a very low level of disclosure on climate change. Surprisingly, multinationals are not providing satisfactory disclosure. The study has policy implications in developing countries for both local policy makers (the government) and international policy makers (the Intergovernmental Panel on Climate Change, the European Union, the World Bank, the UN Environment Programme, the International Energy Agency and the World Economic Forum) as to how to engage local companies so that they become more socially accountable to climate change reporting.
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Acknowledgments
The author is grateful to the Editor in Chief, Professor Luc Hens, and three anonymous reviewers for their helpful suggestions and feedback. The author also acknowledges 32 interviewees who participated in this study.
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Appendices
Appendix 1
Climate change reporting disclosure items (n = 55 items).
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(A)
Policy and Strategy
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1.
Policy statement on operations and climate change
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2.
Public position on climate change science
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3.
Public position on commitment to binding targets
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4.
Policy on addressing product impacts
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5.
CEO/directors articulate views on climate change and GHG emissions
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6.
Individual with specific responsibility for climate change identified or evidence of how responsibility for climate change is delegated
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7.
Existence of a board committee with specific responsibility/remit for climate change, or evidence that the board is engaged in these issues
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8.
Remuneration at executive and board level is linked to climate change performance/issues
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9.
Information about how climate change trends are linked into future company strategy in some way
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10.
Overview/statement of company management system (information and control systems) for climate change
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(B)
Risks
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11.
Identifying financial risk arising from climate change: the financial implications of climate change and related regulation
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12.
Mention of climate change risks (other than physical or regulatory) such as litigation and reputational risks
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13.
Process and systems described for risk identification cover operations
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14.
Process and systems described for risk identification cover products and services
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15.
Details of the physical risks (arising from climate change) to which the company is exposed are given
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16.
Details are given of how those climate change risks are assessed and managed
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17.
The timescales are given over which climate change risks are expected to materialize
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18.
The regions or locations that are affected are given
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19.
The effects of physical risks (arising from climate change) on the company’s supply chain and customers are explained
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20.
Details of the climate change-related regulations, policies or government-sponsored initiatives that affect the company are given
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21.
Details are given of how those regulations, policies or initiatives affect the business
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22.
Details of the business implications of existing or prospective legislation to reduce GHG emissions are given
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(C)
Greenhouse gas (GHG) emissions
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23.
Total gross GHG emissions in CO2-equivalent metric tons
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24.
Report differentiates between Scope 1 and Scope 2 emissions and splits these out in reporting of total gross GHG emissions in CO2-equivalent metric tons
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25.
Indirect (Scope 3) emissions from sources not owned or controlled by the reporting organization but which are a consequence of the activities of the reporting organization
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26.
A measure of GHG intensity by reference to the company’s revenue
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27.
Information in 26 split out into Scope 1 and Scope 2 emissions
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28.
A measure of GHG intensity by reference to non-financial output
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29.
Information in 28 split out into Scope 1 and Scope 2 emissions
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30.
GHG emissions are prepared using one or more standards, national, regional or industry-specific programs
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31.
Quantified targets set
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32.
Targets set using both absolute AND intensity-based units
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33.
Short-term targets set (less than five years)
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34.
Long-term targets set (more than five years)
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35.
Includes progress against previously set targets
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36.
Targets apply to product data
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37.
Process-driven targets set
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(D)
Mitigation and Adaptation
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38.
Energy efficiency measures
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39.
Purchasing energy from low-carbon sources
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40.
Transport and travel changes, increased use and development in low-carbon technologies
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41.
Assessment of, and engagement with, supply-chain GHG emissions
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42.
Climate change mitigation actions discussed
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43.
Climate change adaptation measures discussed
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44.
Generation of renewable energy
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45.
Product innovation/change
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46.
New business model
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47.
Relocation
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(E)
Credibility
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48.
Independent assurance of GHG emissions
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49.
Significant reference to, or use of, WBCSD-WRI GHG protocol
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50.
Use of GRI climate change-specific indicators
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51.
Significant reference to, or use of, ISO 14064-1
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52.
Making general disclosure of corporate objectives/policies relating to the social responsibility of the company to the various segments of society
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53.
Disclosing corporate governance practices
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54.
Oversight board on climate change
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55.
Report on climate change by oversight Board
Appendix 2
See Table 9.
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Nurunnabi, M. Who cares about climate change reporting in developing countries? The market response to, and corporate accountability for, climate change in Bangladesh. Environ Dev Sustain 18, 157–186 (2016). https://doi.org/10.1007/s10668-015-9632-3
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DOI: https://doi.org/10.1007/s10668-015-9632-3