Sustainable development is nowadays a high priority for firms all over the world. Consequently, numerous firms have increased their social responsibility initiatives, reinforcing the credibility and trust of their stakeholders. However, prior research about the relevance of sustainability leadership for the European investment community is scarce. In this context, the aim of this study is to examine whether sustainability leadership – proxied by membership of the Dow Jones Sustainability Index Europe – is value relevant for investors on the 10 major European stock markets over the 2001–2013 period. Our overall results reveal that there exist significant differences across markets. These findings are relevant especially for investors, but also for the managers of listed firms, market regulators and policymakers. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment

Sustainability reporting contributes to making sustainable development a higher priority for companies, increases the social responsibility of their managers, and reinforces the credibility and trust of their stakeholders. However, prior research about the value relevance of sustainability disclosure for financial stakeholders provides inconclusive results. In this context, the aim of our research is to analyse whether sustainability disclosure provides relevant information and incremental value for investors in the European setting where this practice has been steadily increasing in the period 2001-2013. Our overall results support the belief that conducting business in accordance with ethical norms is value relevant for European investors. However, our results also reveal that there is no homogeneity among markets, even for the periods before and after the global financial crisis. These findings could have several implications for internal and external stakeholders such as managers, shareholders, and policymakers.

The banking sector since 2001 has seen an increasing evolution in the number of banks that engage in sustainability in Europe, however, this evolution has been slower when compared to the other sectors of activity. It should be noted that the number of empirical studies in this particular sector in this region covering a specific period of study, which includes the global financial crisis, is scarce. In this sense, the present study evaluates the value relevance of banks listed in the Dow Jones Sustainability Index Europe using a sample of 66 European banks in the stock markets of France, Germany, Italy, the Netherlands, Norway, Spain and the United Kingdom. From 2001 to 2013, the period under review presented a major growth in sustainable investments, by considering the global financial crisis, it was studied in two subperiods, pre and post crisis. Therefore, by using a modified Ohlson model and applying a panel data methodology for the empirical research, consisting of a combination of time series and cross-sectional data in a joint test, it enabled to control individual unobservable heterogeneity as well as the endogenous nature of the explanatory variables. The study found that banks listed in this index are associated with higher market valuations and has a direct effect on stock prices by modifying the value-relevance of financial information. The global financial crisis has led investors to pay attention to sustainability in the banking sector in the European markets and began to include ethical principles in their investment strategies. These findings have important information for both investors and stakeholders, as well as market regulators and policymakers. The present empirical study contributes to the existing literature and encourages investors to play an important role in the sustainable development of such an important sector of society.

In the European Union, the importance of Corporate Social Responsibility reporting is increasing, because 2017 is the year in which the CSR reporting of large companies passes from the voluntary to the mandatory stage according to the requirements of the European Directive 2014/95/EU. In this context, this paper aims to examine the stage of Corporate Social Responsibility in Central and Eastern European Countries members of European Union, in accordance with Global Reporting Initiative which is consistent with globally recognised criteria worldwide, in the period 2002-2018. A critical analysis of the quality of the reporting was performed, looking at whether it has improved over the previous year and whether it respects legal requirements, and whether the communicated information is useful to the stakeholders. Base on literature review it was found that there is a gap of Corporate Social Responsibility’s reporting research to Western European countries. The results show that the evolution of reporting practices has improved over the years for the all countries and the most reports are prepared by multinationals companies. Thus, we can see how companies react to regulatory requirements and other government demands. Keywords: Corporate Social Responsibility, reporting, Global Reporting Initiative, Central and Eastern European Countries, quality

The increasing global importance of the environmental, social and economic aspects and the high complexity of their implications at the corporate level is the reason for an intense and extensive research activity, leading Socially Responsible Investing to a current and prominent theme, namely in Europe. In this context, this study analyses the effects of Socially Responsible Investing on portfolio performance of all listed firms on the ten most important European stock markets over the period 2001-2013 rated by the Global Reporting Initiative. In order to measure the portfolios' performance, a market model and a four-factor model are applied in which risk factors were constructed for the markets under study. A relevant finding of the present study is that investing in this type of firms before the financial crisis was less risky than investing afterwards, as it presented to be riskier. Nevertheless, investing in socially responsible firms which had a higher profitability in the past outperforms the market. However, the results show the existence of market singularities across European countries that must be considered, as well as the periods of pre and post global financial crisis that affected the European stock markets, triggered the sovereign debt crisis, especially in peripheral countries.