Early stage of sustainability reporting: Case study from the Czech tobacco industry

Idea: To examine the potentially controversial role of sustainability reporting in the tobacco industry and to see how the selected company reacted to the new EU Directive 2014/95/EU on non-financial reporting. Data: Descriptive narrative sections from annual reports in years 2011 - 2013 prior to the approval of the regulation and, in years 2014 - 2016, after the Approval and Sustainability report from 2016. The directive should have come into force by the end of 2016. Tools: Content analysis using a specific coding system based on approaches from the CSR system comprising seven main categories. What's new? Key findings: (1) The company was actively preparing for sustainability reporting even before the new regulation came into force. (2) The parent company was concerned about the impact of its activities on stakeholders including the local community. (3) Financial donations became less popular through the years. (4) The company states that it cares about the health of its customers, the working environment, and the labor conditions of its suppliers. So what? Even though the company operates as part of a controversial industry, it is trying to convince stakeholders using its reporting style that it is socially and environmentally responsible. Contribution: We see two effects here: (1) companies in transitional economies copy the behaviour of their parents from western countries (2) the parent company has a strong influence on reporting and helps create a positive impression of itself with various CSR inspired approaches. One campaign titles itself as "The best employer of the region". Despite concerted efforts, there is still a question over genuine credibility.