An approach to using the best-worst method for supporting sustainability reporting decision-making in SMEs

Abstract

This paper proposes a novel methodological approach to help decision-makers inSMEs evaluate and prioritize sustainability reporting (SR) standards. It can thus helpSMEs to overcome some of the problems they encounter when initiating SR. Inorder to explore this decision in more depth, a set of decision criteria are identified,reflecting the costs and benefits that could be derived from SR adoption. Themethodological approach proposed is based on the best-worst multi-criteria decision-making method and is tested on a sample of Spanish SMEs. The results highlight therelevance of SR for the legitimacy and reputation of the firm, with GRI ranking firstamong the SR alternatives. This research helps to strengthen the link betweenacademia and business, by developing a tool with which firms can select a reportingstandard. This is especially relevant for SMEs given their relevant role in nationaleconomies and their general failure to disclose such information.