What Sustainability Disclosures Disclose

Sustainability disclosures are the backbone of corporate sustainability efforts. If stakeholders want companies to compete over how “good” they are for society, they need a way to see what companies are doing and trying to do. But these disclosures have been widely criticized for their lack of credibility and comparability. To improve them, nonprofits and companies have developed voluntary reporting frameworks that many firms have now adopted and that have informed mandatory disclosure regulations. These critiques and regulatory debates have proceeded, however, without basic facts about what these disclosures contain and whether voluntary tools help. Answering these questions has been difficult because of the non-standardized nature of these disclosures.<br><br>This project overcomes these barriers through the use of large language models and provides the most comprehensive analysis of sustainability disclosures to date. We evaluate over 15,000 sustainability disclosure documents issued by more than 2,100 Russell 3000 firms spanning 1998-2023. We construct measurable indicators based on characteristics that stakeholders have identified as relevant: specificity, quantitative evidence, fluff (~puffery), negative news, and data table and figure counts.<br><br>Five patterns stand out. First, sustainability reporting and the adoption of external assurance and voluntary frameworks (GRI, SASB, TCFD, CDP, SBTi) surged after 2015. Second, firms often adopt multiple frameworks at once, and adoption is sticky. Third, as reporting mainstreamed, reports became less specific, less quantitative, and fluffier. Fourth, longer-reporting firms produce more concrete reports (more specific and quantitative, with more tables and less fluff) with more negative news, but these differences largely reflect which firms began reporting early and broad calendar trends rather than learning by doing. Fifth, frameworks show mixed and non-uniform associations with our measures—some with less fluff, more negative news, and more tables, but also with lower quantitative density. We find no consistent evidence that adoption leads to improvements along the dimensions we study.<br><br>The results underscore the potential importance of the rules vs. standards dichotomy in sustainability reporting. Firms unraveled across rule-like margins (whether to report or to adopt a framework) but stalled on the standard-like substance of what reports say, where no settled benchmarks exist.