Sustainability Reporting by New Zealand's Local Governments

This study examines New Zealand (NZ) local government's sustainability disclosure during the five years prior to changes in the legislative environment through the introduction of the Environmental Reporting Bill. Local councils appeared to persistently increase their social and environmental disclosure practices in view of the forthcoming Bill. This is consistent with the underpinnings of legitimacy theory in that pending legislation may introduce restrictive policies and rules in the future that are not consistent with current reporting practices. The highest reporting categories were public agency and the environment, which indicates councils' drive to maintain legitimacy. Further, the results show that local government environmental reporting focused on non-monetary, and to a lesser extent monetary, information. In the absence of mandatory guidelines, the results also indicate that NZ local councils have voluntarily reported sustainability information consistent with GRI indicators. This paper analyses the voluntary sustainability disclosures by New Zealand (NZ) local government for the five years prior to the introduction of the Environmental Reporting Bill in 2014. The finding of a persistent increase in social and environmental disclosures is consistent with a legitimacy approach by local councils in anticipation of changes in the legislative environment.