Examining the extent and quality of corporate water management disclosures in extremely high-water stress countries
Authors: Farooq Muhammad Bilal , Naveed Khwaja , Khalid Fahad , Narayan Anil Kumar , Khudir Ibrahim Mustafa 
Published: January 2025

Purpose
Given growing concerns about water scarcity, this study aims to investigate the extent and quality of corporate water management disclosures (hereafter water disclosures) in countries and jurisdictions facing extremely high water-stress levels. Contextual factors, at a macro/country, meso/stock exchange and micro/company level, influencing water disclosures, are examined.

Design/methodology/approach
The authors adopted an institutional perspective, integrating multi-level organizational fields, including micro/company-level, meso/stock exchange-level and macro/national-level influences while considering factors such as corporate governance (CG), regulatory stringency, cultural traits, advocacy for environmental management, environmental performance and sustainability indices. The authors use a GRI 303-based index to evaluate water disclosures of the top 100 listed companies from 12 stock-exchanges based in extremely high water-stress countries over a five-year period from 2016to 2020. While checking for robustness, the authors evaluate the impact of normative, coercive and mimetic forces on water disclosures at country, stock exchange and company levels.

Findings
Overall, water disclosure rates/extent and quality remain low with only incremental improvements observed over the five-year period. In terms of drivers, at a micro-level, the authors find that robust CG positively impacts water disclosure quality. At a meso level, regulatory stringency, environmental advocacy and the presence of a sustainability index positively influence water disclosure quality. At a macro level, power distance, uncertainty avoidance and masculinity negatively impact water disclosure quality, whereas long-term orientation and uncertainty avoidance positively impact it. Furthermore, countries characterized by robust governance and high environmental performance negatively influence disclosure quality in water sensitive industries.

Practical implications
The findings may prove useful to policymakers and regulators, including stock exchanges, in strengthening water disclosure requirements. Standard-setters may consider introducing more guidelines to assist reporters in improving the quality of their disclosures. Practitioners (managers and assurance providers) may use the findings to benchmark corporate reporting practices.

Social implications
The research provides insights that can inform policies promoting transparency and accountability around corporate use of societies’ scarce water resources. The study advances responsible water stewardship, aligning corporate actions with global sustainability goals, particularly around water scarcity. In doing so, these findings have implications that extend beyond corporate disclosure practices, impacting broader environmental conservation and resource management efforts.

Originality/value
The study examines corporate water disclosure rates and qualities in extremely high water-stress countries and jurisdictions. The evaluation of these disclosures using a GRI 303-based index generates a unique dataset that is analysed from a multi-level institutional perspective (micro, meso and macro) to provide insights into the factors influencing corporate water disclosure practices.