Title: Assurance and third-party comment in sustainability reporting in Japan: a descriptive study

Authors: Mohammad Badrul Haider; Katsuhiko Kokubu

Addresses: Institute of Business and Accounting, Kwansei Gakuin University, 1-155 Uegahara Ichiban-Cho, Nishinomiya, Hyogo, 662-8501, Japan ' Graduate School of Business Administration, Kobe University, 2-1, Rokkodai, Nada, Kobe 657-8501, Japan

Abstract: This paper provides an overview of assurance and third-party comment in sustainability reporting (SR) of Japanese companies. The paper discusses issues concerning these third-party services such as reporting frequency, frequency of assurance and third-party comment in SR; changing patterns in these practices; characteristics of companies that adopt assurance and third-party comment; and types of assuror and commentator. While most leading Japanese companies have adopted SR, the number of those adopting assurance in SR has been decreasing in recent years. However, approximately 50% of companies have adopted third-party comment in SR, which is a unique practice in Japan. Assurance and third-party comment are used predominantly by large companies and environmentally sensitive industries. Consistent with global practice, accounting firms dominate the assurance market followed by nongovernmental organisations and certification firms. This is the first known study to examine this emerging audit practice in Japanese context where majority of large companies publish sustainability reports.

Keywords: sustainability reporting; assurance frequency; reporting frequency; third-party comment; Japan; sustainable development; accounting firms; nongovernmental organisations; NGOs; certification firms; auditing.

DOI: 10.1504/IJESD.2015.070133

International Journal of Environment and Sustainable Development, 2015 Vol.14 No.3, pp.207 - 230

Received: 18 Feb 2014
Accepted: 30 Sep 2014

Published online: 11 May 2015 *

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