Ruan Gerber, Anet Smit, Martin Botha
Abstract
Globally there is a tendency for companies to put more emphasis on sustainability and the disclosure of nonfinancial information in their annual reports. The sustainability of the agricultural sector is important due to its impact on the environment, hence the emphasis on ESG reporting. This paper sought to assess the nature and extent of ESG reporting by agribusinesses in South Africa. A content analysis of 30 ESG related keywords is used to analyse the non-financial reports of agribusinesses. Results from the keyword count indicated a considerable variation in the usage of words, but an even distribution of keywords related to each ESG dimension.
The complexity of agribusiness activities, spanning across a vast supply chain, makes quality reporting difficult. It was evident that under the environmental pillar, the keyword count reveals climate was not one of the top keywords (fifth place out of the ten keywords) used. This may be indicative that agribusinesses do not yet realize the full impact that climate change poses to their business. The keyword greenhouse, synonymous with climate change, was the least-used word in ESG reports. An indication that agribusinesses are not paying enough attention to the risks of climate change. It is recommended that agribusinesses embrace the newly proposed GRI sector standards for agriculture, aquaculture, and fisheries, assess the materiality of the provided topics and disclose aspects that are material to their operations.