Dear Colleagues,

In the last few years, and in particular following the COVID–19 outbreak, we have witnessed an increase in the focus on sustainable accounting and finance. Integrating sustainability aspects in corporate strategy has received a great deal of interest and discussion inside and outside the firm. Sustainable investments are obviously conferring a halo effect that considerably enhances the firm's reputation as “sustainable” or “environmentally friendly”, thus increasing its chances of obtaining external financing at better conditions. Indeed, investors and other stakeholders seem now interested, more than ever before, in the commitment of firms to more sustainable and impact-driven investments, which may explain the considerable efforts of managers in identifying sustainable investment opportunities, managing sustainability risks, and reporting material-related impacts. The recent period has also witnessed a proliferation of several bodies setting standards and sustainability-specialized rating agencies that championed a focus on sustainability reporting. However, the absence of harmonization among those “sustainability benchmarks” might be more hurtful and confusing than helpful for companies. The importance of sustainability reporting is also highlighted by many regulators worldwide, who require companies to disclose more historical and prospective sustainability data. At the same time, there is still no consensus on what makes an investment “sustainable” rather than pure “greenwashing”. Moreover, most sustainable investments are also characterized by large uncertainty and long-term impacts on the society/environment, thus reducing litigation risk and leaving more room for managerial discretion.

The recent challenges linked to sustainable accounting and finance raise many questions that interest academics, practitioners and regulatory bodies alike. Are more sustainable firms better valued and better regarded by its stakeholders? Do market participants lend more credence to the sustainability commitment of the firm? What shapes the investors’ perceptions of the 'sustainable health' of their investment portfolio? Are disclosures on sustainability informative and value-relevant given the complexity and lack of uniformity and verifiability of sustainability data? Are sustainability textual narratives useful for investors? What risks are associated with excessive and highly sophisticated information produced in the race for a “sustainable” reputation? To what extent are sustainable accounting and finance affected by social, legal and extra-legal aspects of the environment? 

These questions, and many others, underscore the need for additional research on sustainability that sheds more light on the “sustainable behavior” of firms and their stakeholders. This Special Issue will contribute to prior literature on sustainability reporting, sustainable finance, business ethics, and corporate governance alike. It will also offer additional insights into the perception of sustainable accounting and finance by investors and other stakeholders.

The Special Issue welcomes theoretical and empirical contributions. Topics of interest include, but are not limited to:

• Green finance, green bonds, climate change bonds, transition bonds, and cost of financing;
• Sustainability, performance, and value creation;
• Sustainable investments, innovation, and efficiency;
• Sustainable finance, corporate governance, ethics, and culture;
• Quality of sustainability information, informativeness, and value relevance;
• Textual analysis, language tone, and management sentiment in sustainability reporting
• Sustainability reporting and corporate governance;
• Sustainability reporting and stakeholder decision making;
• Sustainability reporting: standards: harmonization, enforcement, mandatory versus voluntary reporting;
• Sustainability reporting, audit committees, external auditors, certification, and external evaluation;
• Sustainability reporting: real effects and stock market effects;
• Green accounting and green accounting management.

Prof. Dr. Sabri Boubaker
Dr. Imen Derouiche
Prof. Dr. Hisham Farag
Dr. Marwa Elnahass
Guest Editors

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