Introduction

Sustainability reports are important communication tools (Axjonow et al. 2018) for corporations to disclose their governance and triple-bottom-line issues to organizational stakeholders. Companies’ motivation for sustainability reporting creates the impression among stakeholders that they are interested in corporate social responsibility (CSR) and are legitimate and accountable (Dobbs and van Staden 2016). It also demonstrates its commitment to the interests of society and various stakeholders (Garg and Gupta 2021). Yet, improving stakeholder relations and integrating corporate governance practices into business processes creates the risk of increased pressure for companies (Price 2018). In the longer term, sustainability reports provide an opportunity for companies to demonstrate how they integrate governance considerations and environmental and social performance issues, and communicate the value of their activities (Manetti 2011; WBCSD 2018). As is well known, sustainability reporting involves a multifaceted approach, with values at its core (Kuzey and Uyar 2017; Shams 2013).

In particular, the pressure on companies to innovate and sustain successful business operations caused by the current business environment (Cardoni et al. 2019; Iqbal et al. 2020) increasingly requires stakeholders to contribute to business activities by expressing new ideas and collaborating with members (Edmondson 1999; Newman et al. 2017). As early as 1999, Edmondson pointed to the importance of a secure organizational climate as a prerequisite for stakeholder mobilization (Edmondson 1999). In a recent work, Edmondson and Bransby (2023) emphasize that psychological safety is an important managerial issue in improving work experience and promoting learning behavior. As a result, employees can be expected to receive more attention as stakeholders. Whilst balancing stakeholder engagement is essential for organizational survival and success, stakeholder management is complex in practice since motivating certain stakeholders can lead to the alienation of others (Daft 1998; Fernandez and Thams 2019). Consequently, sustainability reports are expected to provide a variety of information about the organization’s structure and its relationship with stakeholders.

Recent studies on sustainability reporting in Turkey focus on either a certain period or a specific business sector, such as the banking sector (Demirci 2022), and the airline industry (Okumus et al. 2020). Other research analyzes sustainability reporting and ownership structure and board attributes (Aksoy et al. 2020), firm value (Kuzey and Uyar 2017), supply chain management (Desticioglu and Ozyoruk 2022), corporate governance (Önder and Baimurzin 2020), corporate attributes (Özcan 2020), the International Integrated Reporting Council Framework (Kılıç and Kuzey 2018; Needles et al. 2019), and disclosure of carbon emissions (Kılıç and Kuzey 2019). The studies conducted by Uyar (2017) and Karaman et al. (2018) can be pointed out as longitudinal studies. Most research on stakeholders in sustainability reports covers a limited number of reports published in a specific year (Ararat and Göcenoğlu 2005; Aşçıgil 2012; Oruç 2015; Şener et al. 2016). Longitudinal studies are still rare, not only in the Turkish context but also on a global scale (Pisani et al. 2017). Şener et al.’s (2016) call for a longitudinal and comprehensive examination of stakeholder representations in sustainability reports has not been answered until now. As sustainability integration occurs over a long period of time, a longitudinal approach is used to assess sustainability (Caputo et al. 2017) and relevant stakeholders.

The research aims to identify the stakeholder trends disclosed in sustainability reports of corporations operating in Turkey, as Turkey is a rapidly developing, industrializing, and urbanizing country with a constantly growing market of 80 million people and stakeholder management has not been studied longitudinally. For this, a quantitative content analysis was conducted to reveal how the stakeholders addressed have changed over 16 years. The research fills a gap in the literature by analyzing published sustainability reports from a longitudinal perspective. It takes into account Mitchell et al.‘s (1997, p. 854) definition of stakeholder salience as “the degree to which managers prioritize competing stakeholder demands”. The prioritization of a stakeholder group is reflected in the number of projects allocated in reports, the amount of information provided, and thus the number of times a stakeholder is mentioned. Changes in the global business landscape affect the prioritized demands, and this is reflected in the stakeholder groups mentioned. In this regard, the following main research question is sought to be answered: How have the stakeholders addressed in sustainability reports changed in the last 16 years? This research will significantly enhance the sustainability reporting literature and stakeholder literature by delivering an unprecedented longitudinal analysis of long-term stakeholder representation for listed companies, underscoring the crucial importance of long-term research in this field.

Reporting practices in international context

Reporting practices and policies on stakeholder relations vary according to national contexts. International organizations argue that there cannot be uniform international corporate governance regulations due to domestic conditions and priorities (Yüksel 2008). Citizens in stakeholder-oriented countries have stronger preferences for firms to act pro-socially and the importance given to sustainability reporting is significantly higher in civil law countries than in common law countries (Ferguson et al. 2022). According to Garcia-Sanchez et al. (2016) and Coluccia et al. (2018), companies in countries where social, political, and legal factors are influential, are making every effort to ensure CSR disclosure. Since the turn of the century, specific laws and regulations on corporate responsibilities have been adopted in various countries. The Sarbanes-Oxley Act, passed by the U.S. Congress in 2002, mandated strict reforms to existing security regulations and introduced severe new penalties for lawbreakers (Kenton 2023). The act created the Public Company Accounting Oversight Board to oversee the accounting industry, banned company loans to executives, gave job protection to whistleblowers, and held chief executive officers (CEOs) personally responsible for errors in accounting audits (Amadeo 2019). The German Corporate Governance Code (2002) presented statutory regulations for the management and supervision of German-listed companies and contains internationally and nationally recognized standards for good, transparent, and responsible governance (DCGK 2020). In India, the enactment of the Companies Act 2013, a regulatory pressure from the government mandating CSR spending, had an impact on firm diversity and competitive advantage (Nair and Bhattacharyya 2019). The overall structure of government policies to promote CSR can serve as a starting point to assess the effectiveness of relevant initiatives (Lu et al. 2019). However, governments, stock exchanges, and national and international organizations are also directly involved in sustainability reporting, as they help markets to proceed transparently and sustainably (Bini and Bellucci 2020). For example, the adoption of the European Union Non-Financial Reporting Directive into the laws of European Union (EU) member states has resulted in high levels of reporting (KPMG 2020).

Sustainability reporting in Turkey

Turkey has a civil law system based on codified laws. Companies are regulated by several laws, most notably the Turkish Trade Law of 2011, which sets out corporate responsibilities towards stakeholders and the environment. Moreover, Turkey is a member of and party to several international organizations. It is a founding member of the Organisation for Economic Co-operation and Development (OECD) and the Group of Twenty (G20) and belongs to the Emerging 7 (E7) countries. In 2023, Turkey’s economy is the 19th largest in the world by nominal gross domestic product (GDP), and the 11th largest by purchasing power parity. According to the International Monetary Fund (IMF), Turkey is an upper-middle income mixed market emerging economy (IMF 2023). As a country particularly vulnerable to the impacts of climate change, it is also working with the World Bank to foster green finance. The 11th National Development Plan (2019–2023) sets out the goal of protecting the environment and natural resources, ensuring their effective, integrated, and sustainable management, implementing climate-friendly practices in all areas and raising environmental awareness and sensitivity of all segments of society (The World Bank Report 2022). Turkey has emphasized its commitment to contribute to a sustainable world since the adoption of Agenda 2030 (Sustainable Development Knowledge Platform 2019).

Turkey’s corporate governance and sustainability reporting have evolved significantly over the years, reflecting global trends and the country’s economic development. In the late 1990s, Turkey experienced a financial crisis that highlighted the need for stronger corporate governance practices. As a response, the Capital Markets Board of Turkey (CMB) issued the first set of Corporate Governance Principles in 2003, drawing inspiration from international standards such as the OECD Principles of Corporate Governance. In the early 2000s, Turkey saw the introduction of enhanced disclosure requirements for listed companies. Initially, CMB adopted the corporate governance principles for public joint-stock companies with the “comply or explain” approach. The voluntary implementation of the OECD Corporate Governance Principles, published in 2003 and gaining mandatory status in 2011, requires listed companies to comply with the provisions recommended in the Corporate Governance Principles (OECD 2017). The CMB mandates that financial statements and annual reports be publicly disclosed according to the International Financial Reporting Standards (IFRS). These measures aim to improve transparency and provide investors with more reliable information. Borsa Istanbul Stock Exchange (BIST) launched two listings called the BIST Corporate Governance Index (2007) and the BIST Sustainability Index (2014). The purpose of the BIST Corporate Governance Index is to measure the price and return performance of companies, and BIST Sustainability Index aims to guide companies in the policy-making process by taking into account the risks related to environmental, social, and governance issues, as well as to inform investors about companies’ sustainability policies and principles (Borsa Istanbul 2023). The CMB issued Sustainability Reporting Guidelines in 2018 to provide a framework for companies to disclose non-financial information. These guidelines align with global reporting frameworks, such as the Global Reporting Initiative (GRI), and encourage companies to report on their environmental impact, social initiatives, and governance practices (CMB 2022). Today, the publication of a corporate governance report is obligatory just like the annual financial report. Sustainability reporting in Turkey has become more important since the introduction of these two new indexes. However, despite the introduction of the Sustainability Index, sustainability reporting is still voluntary. Misiuda and Lachmann (2022) point out that EU and US companies still predominantly report sustainability voluntarily, without mandatory requirements. Research by Desticioglu and Ozyoruk (2022) indicates that Turkish companies adopt sustainability principles mostly due to legal obligations, public awareness, and pressure from civil society organizations. The trend toward government regulation of mandatory reporting alone may not lead to an increase in CSR reporting, except for companies that have a strong intrinsic motivation to report (Ali et al. 2017).

Operationalization of stakeholders for coding

The term ‘stakeholder’ first appeared in the management literature in 1963, and since then, it has been defined and theorized in various ways. A chronology of selected studies to date on stakeholder identification can be found in Mitchell and Lee (2019). The stakeholder model associated with Freeman (1984) has been widely accepted as a heuristically strong theory of the firm’s responsibilities to society (Dunn and Burton 2006). Although the concept of stakeholder has been accepted in the business world, a common consensus on the meaning has not been achieved (Miles 2012). Since Freeman (1984) broadened the term by defining it as “any group or individual who can affect or is affected by the achievement of the organization’s objectives”, its use has increased (McGrath and Whitty 2017). Despite the existence of definitions that can distort conceptual interpretations (Friedman and Miles 2006), many of the studies in academia have adopted the idealized definition by Edward Freeman, which provides a lasting foundation for efforts to define and shape stakeholder concepts (Clarkson 1995; Mainardes et al. 2011). Research shows that the list of potential stakeholders can grow rapidly, and impact is the only criterion for identifying stakeholders without the term ‘materiality’ (Barnett, et al. 2018). It should be understood what the perceived stakes are, and who the stakeholders are in the organization (Freeman 1984). Harrison and John (1996) argue that the focus is on internal rather than external stakeholders.

Freeman’s (1984) stakeholder map can be used as a starting point for almost any issue of importance, which consists of activist groups, competitors, customers, customer advocate groups, employees, the financial community, government, owners, political groups, suppliers, trade associations, and unions. Avenarius’s (2000) classification consists of markets, supply markets, fields of competition, labor markets, political space, sociopolitical space, media and culture, and capital markets. Harrison and John (1996) listed an external list of stakeholders including activists, competitors, customers, government agencies and administrators, local communities, suppliers, and unions. The World Business Council for Sustainable Development (WBCSD 2002) created a comprehensive list of stakeholders with employees, contractors, trade unions, media, customers, interest groups, communities, suppliers, non-governmental organizations (NGOs), government, industries and business associations, investors, research groups, and academic institutes.

In addition to listing stakeholders, stakeholders can also be classified into specific categories such as moral claimants, risk-takers or influencers (Mitchell et al. 1997), primary and secondary (Freeman 1984; Clarkson 1995), or internal and external stakeholders (Wood and Jones 1995). The major weakness of simple typologies is the lack of consideration of relational attributes such as proximity or connection since most of them imply a categorization rather than a fine mix of variables (Miles 2017). On the other hand, such classification allows the allocation of limited resources appropriately (Freeman 1984; Mitchell et al. 1997), improves explanations of value creation generally (Mitchell and Lee 2019), or generates economic profits (Barney 2017). Primary stakeholder groups (employees, customers, investors, the public, shareholders, and suppliers) are critical to the well-being of the organization (Clarkson 1995; Eskerod et al. 2015), whereas special interest groups or the media defined as secondary stakeholder groups are those who do not transact with the company and are not necessary for its continued existence (Clarkson 1995). A classification made in stakeholder identification research focuses more on explaining the importance of stakeholders for the survival of companies (Mitchell and Lee 2019). Identifying stakeholders has always been important (Bryson 2007). However, there is still a wide divergence in the literature (Freeman 1984; Wood and Jones 1995) about who should be considered as stakeholders. This can be explained by the fact that researchers use stakeholder analysis for different aims or in a different context (Pouloudi and Whitley 1997). Stakeholder representation has been researched experimentally and theoretically (Deegan 2002; Laplume et al. 2008; Neville et al. 2011; Khedmatgozar et al. 2023), but not much is known about the situation in Turkey where the importance of stakeholder management, governance, and CSR has been recently discovered. Aşçıgil (2012) surveyed managers of Turkey’s 500 largest industrial enterprises and found that customers are the most important stakeholder, followed by employees, investors, and society. Şener et al. (2016) found that the most salient stakeholders are the environment, special interest groups, and employees, whereas government, media, and competitors are the least frequently discussed groups. Managerial attributes are seen as moderators of stakeholder-manager relationships, which explains why the relationships are not static but in a continuous flow (Mitchell et al. 1997). This explains why an initially unidentified stakeholder may change its position on other critical issues and align with them over time (Wood et al. 2021). In the stakeholder literature, there is a long-standing debate about who and what matters as stakeholders of the company (Laine 2010). According to Driscoll and Starik (2004) and Haigh and Griffiths (2009), the non-human nature should be integrated into the concept of stakeholder management as it is underrepresented by other stakeholder groups and because of its qualities such as power, legitimacy, and urgency. In contrast, advocates argue that corporations have a responsibility to the society in which they operate, not to the natural environment (Phillips 2003), and that non-human entities hinder strategy-making because they do not participate in debates and policy-making processes (Boutilier 2011). A recent study by Hess et al. (2023) suggests that strategic investment decisions are influenced by impacts often associated with the natural environment, but a conscious recognition of the natural environment as a strategic stakeholder or as an essential factor in strategic investment decisions cannot be confirmed. In particular, local knowledge and expertise are essential for successful environmental decision-making and governance, ecosystem accounting, protection, and management of natural resources (Brooks 2022).

Research methodology

This research aims to explore stakeholder-related trends in sustainability reporting. For this, all individuals, groups, institutions, and organizations disclosed in sustainability reports were identified to show how stakeholder lists, rankings, and groups have changed and flourished over the past 16 years for corporations operating in Turkey. Using indicators from the field of journalism, where the “top story” gains importance through receiving more coverage (Weber and Marley, 2012), we assessed the importance of the stakeholder-based on the number of mentions. The research aims to answer the following questions:

  • How have the stakeholders addressed in the sustainability reports changed over 16 years?

    1. ○

      Has there been a change in the number of stakeholders mentioned in the reports?

    2. ○

      Are there any stakeholder groups that come to the fore by being mentioned more frequently?

    3. ○

      If so, have the more frequently mentioned stakeholder groups changed over time?

Data Sources

15 companies were listed in the BIST Sustainability Index in 2015, this number increased to 58 in 2021. In March 2021, there were 31 corporations listed in both the BIST Sustainability Index and BIST Corporate Governance Index (Public Disclosure Platform 2021). The sample is limited to companies listed in both indices. The reason for focusing on these two indices is their stronger sustainability commitments, as evident from the data presented. Five companies were eliminated because one company’s reports could not be downloaded in .pdf format, and the other four companies did not publish a sustainability report. Sustainability reports were considered synonymous with corporate social responsibility reports (Dilling and Harris 2018), sustainable development reports, or integrated reports. The final data source of the study consists of 179 sustainability reports published by 26 companies between 2004 and 2019. Company codes were AEFES, AGHOL, AKSA, ARCLK, ASELS, ALBRK, AYGAZ, CCOLA, DOAS, ENJSA, ENKAI, EREGL, GARAN, GLYHO, HALKB, LOGO, MGROS, OTKAR, SISE, SKBNK, TAVHL, TOASA, TSKB, TUPRS, YKBNK, and VESTL.

A sectoral analysis was conducted as the results can be influenced by the industry, and the sample companies as well. The industries of technology defense (4%), basic metal (3%), consumer-trade (2%), information technology (2%), construction (2%), and electricity (1%) were the least reported industries. Classified reports on business-to-customer (B2C) and business-to-business (B2B) companies represent 12 industries according to the products manufactured or the services provided. B2C companies cover sectors such as financial institutions/banks, food, beverages, tobacco, consumer trade, fabricated metal products, machinery, equipment and vehicles, B2B companies cover sectors such as holding and investment, technology defense, basic metals, chemicals, petroleum rubber, plastic products, electricity (gas, water), construction and information technology. During the review period, 62% of the reports were published by B2C companies, whereas B2B companies published 38% of the reports. The financial institutions/banks (22%) showed the highest sectoral rate of sustainability reporting, followed by the chemicals, petroleum rubber, and plastic products (19%), vehicles (15%), food, beverage, tobacco (13%), fabricated metal products, machinery, electrical equipment (10%), and the holding and investment companies (8%).

Data Analysis

The reports were analyzed through quantitative content analysis based on inductive category development. Content analysis was applied, as it is a useful technique and systematic reading (Krippendorff 2004) to gather data that consists of codifying qualitative information into categories and to develop quantitative scales of varying levels of complexity (Bhatia and Chander 2014; Abbott and Monsen 1979). Mayring (2000) defines inductive category development as a reductive process, in which the reports are studied, and categories are extracted stepwise. Within the feedback loop, categories were defined and checked for reliability by the second researcher and reduced to main categories. The literature generally follows either the number or the amount of disclosures. Both approaches have their value, but most literature suggests the latter provides a richer data set and, in many cases, automatically covers the former (Cowen et al. 1987; Gray et al. 1995). Identifying stakeholders is essential, but it was also questioned whether there is an overlap between salient stakeholders and the prioritized issues disclosed in the reports. To clarify this situation, the latest reports (2019) and statements of the companies regarding stakeholder engagement were examined. Further frequency analysis and weighted average calculations were made to see whether or not statements were made regarding the expressed stakeholders. To avoid inter-coder reliability problems (differently named stakeholders such as client, customer, personnel, worker, employee, investor, financier, international, foreign), specific issues were negotiated until sufficient agreement was reached and disagreements resolved. According to Bayerl and Paul (2011), if multiple coders agree on their decision to code the same material, the intercoder agreement can be seen as a semi-standard procedure for testing the accuracy of explanations.

Each stakeholder disclosed in the reports was coded and sum, frequency, average, and rankings were calculated using MAXQDA. As a documentation center, such programs facilitate on-screen text analysis, record all analysis steps of all interpreters, make the analysis understandable and reproducible, offer links to quantitative analysis, and compare the frequencies of categories without the danger of error when manually exporting data to another computer program (Mayring 2000).

Results

In 2004, the chemicals, petroleum rubber, and plastic products industry published the first sustainability report, followed by the fabricated metal products, machinery, and electrical equipment industry in 2007, the food, beverage, and tobacco industry in 2008, financial institutions/banks and vehicles in 2009, and the holding and investment companies in 2010. The construction, information technology (since 2017), and electricity (since 2019) industries have recently started publishing reports.

Report Names

As shown in Table 1 below, the reports reviewed are presented under various headings.

Table 1 Used report names between 2004 and 2019.
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In the early 2000s, some companies expressed their reports as “Sustainable Development Report” or “Corporate Social Responsibility Report”, which continued until 2014 and 2015. The heading “Sustainability Report” which is generally accepted and used in 76% of the reports was first used in 2007 and continued in the following years. A small number of other report names used for reporting are “Corporate Responsibility Report” used between 2009–2014, “Sustainability Review” used in 2010, and “Corporate Sustainability Report” used in 2011. Integrated reporting started with financial institutions such as the TSKB (Industrial Development Bank of Turkey) in 2016 and GARAN (Garanti Bank) in 2017. As a new reporting form, the number of “Integrated Reports” has been found very low: 6%. The length of the reports increased from 22 pages in 2010 (titled Sustainability Review) to 630 pages (Integrated Annual Report) in 2018. The differences are not industry-specific. In 2019 the YKBNK (Yapi Kredi Bank) presented a 124-page report, whereas the report prepared by GARAN was 534 pages. The average length of all reports is 92.

Stakeholders expressed in the reports

In the reports, 152 stakeholders were mentioned. This multiplicity arises from several synonymous words that could be used for a special word (human resource or personnel for employees, public authorities, and public bodies for public institutions or people for society). After eliminating the synonyms, 102 stakeholders were listed between 2004 and 2019. The number of disclosed stakeholders started with 12 in 2004 and grew rapidly in the following years to 56 in 2009, and 59 in 2017. Eight constant stakeholders, namely employees, suppliers, NGOs, customers, society, public institutions, investors, and shareholders were addressed increasingly during the whole review period, whereas subtypes and other stakeholders were added or removed later in the following years. In the years 2005 and 2006, no “new stakeholders” were disclosed.

After 2004, many new stakeholders were disclosed in 2007, covering the media, local community, dealers, trade unions, business partners, analysts, sellers, indirect employees, potential investors, and representatives. In 2008, regulatory authorities, authorized services, consumers, education and research institutions, industry associations, universities, the banking industry, opinion leaders, international financial institutions, government, retailers, legislators, foreign investors, and technical education schools were disclosed for the first time. Other entries emerged in 2009 with academicians and distributors at the top, followed by international organizations and partnerships, competitors, credit rating agencies, manufacturers, media members, bureaucrats, financial analysts, politicians, writers, artists, selling points (outdoor sale points, supermarkets, and grocery stores), farmers, and pressure groups. Further consumer sub-types were expressed as a consumer of competing brands, end-product users, and non-consumers. An important entry in the list of stakeholders was subcontracting, which existed for a long time but was listed as a stakeholder in 2009. Stakeholders listed in 2010 were financial and credit institutions, the aviation industry, civil society, and passengers. In 2011, emphasis was put on local authorities, and in 2012 on senior management, group companies, families of employees, the board of directors, local media, and the CEO. In 2013, shareholders were listed as main and minority shareholders. Associations, unions, companies, consultants, chambers of industry, the finance sector, public opinion, experts, production groups, and internal departments were also added. In 2014, the stakeholder map grew with students, the business world, and visitors. In 2015, potential employees and scholarship students were identified as stakeholders. In 2016, the supply chain, sustainability representatives, and development finance institutions were included, and in 2017, social stakeholders, chamber, tax institutions, portfolio management companies, project owners, and third-party audit firms were added. The list grew in 2018 with bond investors and future generations, and in 2019 with ventures.

Stakeholder groups

The high number of stakeholders disclosed were classified into 16 stakeholder groups, including employees (25%), customers (16%), society (11%), suppliers (9%), sellers (8%), industry (6%), management (6%), business partners (5%), educational and research institutions (4%). This is followed by very few disclosures to civil society organizations, public institutions, media, investors, financial institutions, international organizations, and competitors. Figure 1 shows the stakeholder ratios calculated according to the number of frequencies between the years 2004 and 2019.

Fig. 1
figure 1

Disclosure of stakeholder groups by frequencies between 2004–2019.

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According to Fig. 1, employees are currently the most disclosed stakeholders, followed by customers, society, management, business partners, suppliers, and industry. Society is the group that has changed most over the years. Whilst society represented the second most disclosed group in 2007, today customers have taken their place. Low frequencies were found for financial institutions, investors, civil society organizations, competitors, international organizations, media, and public institutions.

Priority issues

It was implied in all company reports that sustainability priorities, which are the most important output of the report, were determined by considering the opinions and feedback of the internal and external stakeholders. ‘Stakeholder engagement’, ‘communication with stakeholders’, and ‘sustainability priority issues’ were featured in 96% of the latest published reports. Additional titles used were ‘stakeholder map’, ‘stakeholder management’, or ‘stakeholder relations’. Methodologies and evaluations of organizations such as the United Nations Sustainable Development Goals, Global Reporting Initiative (GRI), AA1000 Stakeholder Engagement Standard, ISO 26000, and Sustainability Accounting Standards Board (SASB) were also taken into account in determining the priority areas and subjects. Very few companies prioritized stakeholders and communication tools according to the World Economic Forum, and the European Foundation for Quality Management (EFQM).

A materiality matrix is shown in 96% of the reports. 51% of the expressed issues are social, 23% environmental, 19% economic, and 7% governance-related. Among the 218 identified issues, the most widely disclosed are ‘occupational health and safety’ (8%), ‘diversity and equal opportunity’ (7%), ‘customer satisfaction’ (7%), ‘climate change’ (6%), and ‘talent management’ (6%).

Sectoral Analysis of Stakeholder Groups

A sectoral analysis is conducted to see whether the disclosures of stakeholder groups are affected by the industry, by years, and by frequencies. Figure 2 shows that the results can be influenced by the industry.

Fig. 2
figure 2

Average disclosure of stakeholders by B2B and B2C industries.

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A large number of stakeholders were disclosed in B2C industry reports (61%). The industry-specific figure shows that B2C industries (fabricated metals, banking, customer trade, and food and beverages) made more stakeholder disclosures than B2B industries (basic metals, chemicals, defense, holding, and investment). Here, the banking sector took the lead, whereas the chemical sector ranked first in B2B industries. ‘Customers’, ‘society’, ‘sellers’, ‘management’, ‘financial institutions’, and ‘consultants’ were more salient in B2C industries, in contrast, ‘employees’, ‘suppliers’, ‘industrial actors’, ‘education and research institutions’, and ‘civil society institutions’ prevailed in B2B industries. The stakeholder group that both industries did not care much about were ‘competitors’.

Discussion

Sustainability reporting is a well-established practice (Higgins and Larrinaga 2014), regarding how organizations demonstrate their practices, commitments, and performance to stakeholders (Higgins et al. 2020; KPMG 2022). Recently, there has been a significant number of conducted longitudinal studies on country-sustainability reporting. When analyzed on a continental basis, studies conducted in Asian countries such as China (Dong et al. 2020; Li et al. 2022), India (Ghosh and Bhattacharya 2020), Indonesia (Handayati et al. 2022), Malaysia (Elaigwu et al. 2022), Saudi Arabia (Ebaid 2023), and Sri Lanka (Eranga and Wijesinghe 2021) stand out. Among the European countries, studies conducted in France (Gillet-Monjarret 2018), Italy (Rossi and Tarquinio 2017), Poland (Bolibok 2021), Spain (Curtó-Pagès et al. 2021) can be mentioned. For North America, there are studies on Canadian (Dilling and Harris, 2018) and US companies (Matuszewska-Pierzynka 2021), for South America, the Chilean study (Lavin and Montecinos-Pearce, 2021) can be referenced. Reference can also be made to Australia (Yunus et al. 2020). Igwe et al. (2023) note that sustainability reporting in Africa is on the rise, but studies on the topic are scattered and do not constitute an intellectual corpus. For future research, the authors suggest a longitudinal approach to provide more information on the evolution of sustainability disclosure. Numerous studies have been conducted on emerging nations such as China, Bangladesh, and Malaysia, on the other hand, developing countries such as Egypt, Turkey, Argentina, and Mexico have been ignored (Khan et al. 2020).

Given this background, there remains the need to examine reports in a long-term context, as little is known about the Turkish context, where the importance of CSR, governance, and stakeholder management is recently being explored (Desticioglu and Ozyoruk 2022). In Turkey, companies are publishing sustainability reports in line with global business trends that gained international support at the turn of the century. The first report was published in 2002 by Turkcell, a telecommunications company. Since then, the number of companies regularly publishing sustainability reports has increased. This longitudinal investigation identifies which stakeholders have been disclosed since the early 2000s in sustainability reports of companies operating in Turkey. Sustainability and corporate governance reporting regulations and standards introduced by the Turkish government and stock exchange since the early 2000s have led to an increase in sustainability reporting over the years. Al-Shaer et al. (2021) point out that the main determinants of sustainability reporting are external and internal governance-related factors, reporting behavior, and quality. So, companies in countries where these drivers are effective are making every attempt to provide CSR disclosure (García-Meca and Martínez-Ferrero 2021). Although significant progress can be observed in sustainability reporting, Turkey needs time to catch up with the global average. But, where the largest firms lead, others inevitably follow (KPMG 2017). This also applies to the case of Turkey. The engagement of various stakeholders such as business, educational and research institutions, industry associations, NGOs, suppliers, investors, shareholders, credit rating agencies, and opinion leaders, providing insights into potential problems and solutions, can improve the overall quality of the government’s, CMB’s and Borsa Istanbul’s initiatives and regulatory frameworks, which in turn will have a positive impact on sustainability reporting and sustainability issues.

In identifying materiality issues, institutions have preferred several guidelines and standards such as the Global Reporting Initiative (GRI), International Organization for Standardization (ISO) 26000, United Nations Sustainable Development Goals, AA1000 Stakeholder Engagement Standard, Sustainability Accounting Standards Board (SASB), which are committed to developing and promoting CSR and standards. These are also the leading and preferred standards expressed in terms of compliance with the sustainability principles set by the CMB (2022). Needles et al. (2019) also state that the number of companies reporting on sustainability in Turkey is increasing and the GRI reporting framework is predominantly followed. Multiple headings can be preferred for naming reports. Although headings such as ‘Sustainable Development Report’ and ‘Corporate Social Responsibility Report’ were used for a short time, today ‘Sustainability Report’ is the preferred title for economic, social, environmental, and governance disclosures. The heading alternatives for sustainability reports derived from the words corporate, social, responsibility, and sustainability in the past are now also used for integrated reports; alternative titles such as ‘integrated sustainability report’ and ‘integrated annual report’ are used for integrated reports. To date, the number of integrated reports is quite low in Turkey. The International Integrated Reporting Council (IIRC) has made significant efforts to define and promote integrated reporting worldwide, but, as Murphy (2015) notes, it is still at an early stage of uptake. Therefore, national regulations and stock exchange guidelines are still required to promote integrated reporting as well as international frameworks.

Researching stakeholder representation over a 16-year timeline indicates an increase in the number of stakeholders cooperating with corporations on various subjects and at different levels. Some companies disclose their stakeholders by using a stakeholder chart, others refer to the governance principles. The current study helps to see where the stakeholders are placed on the company’s agenda. According to the findings, the word stakeholder was first used in a sustainable development report published by a corporation in the chemicals, petroleum rubber, and plastic products industry in 2004. From this year, steady growth and top scores were found, which can be stated as a reflection of the Corporate Governance Principles for the Turkish Capital Markets issued in 2003. The analyses show that the number of disclosed stakeholders started with 12 in 2004 and reached 102 stakeholders for the review period, which was then classified into 16 stakeholder groups. Eight stakeholders, namely ‘employees’, ‘suppliers’, ‘NGOs’, ‘customers’, ‘society’, ‘public institutions’, ‘investors’, and ‘shareholders’ were addressed increasingly with synonymous words and a variety of sub-types during the whole review period. This exhibits that companies have expanded the basic list of stakeholders by going beyond the classical representation of stakeholders toward a more detailed and specified classification. Over the same period, changes are observed in the priority ranking of stakeholders. In the early 2000s, stakeholder disclosures exhibited a close resemblance to one another, whereas, in 2009 and subsequent years, a notable distinction emerged, particularly in the cases of ‘employees’ and ‘customers,’ setting them apart from other stakeholders. ‘Society’ is the group that has changed most over the years. In 2007, society held the second-highest level of disclosure, but ‘customers’ have since taken their position in the present day. This could be attributed to the fact that ‘customer’ possesses an unequivocal definition, whereas ‘society’ has evolved into numerous more specialized subgroups over time, many of which have not received significant coverage in the reports. The prioritization of customer-related disclosures can further be explained by the fact that the focus on creating financially added value takes precedence over creating social value. Devinney (2009) already asserted that it is a naive assumption to think that companies will direct their strategies according to the needs of society rather than their interests. The increased attention to ‘customers’ at the expense of ‘society’ after 2007 can be explained by the 2008 World Economic Recession. In the case of Turkey, the radical increase in the mention of ‘society’ as a stakeholder in 2013 can be associated with the rise of social movements, which reached its peak with the Gezi Events in 2013, seen as part of the global protests following the 2008 economic crisis (Kaya 2017). With the declining sanctioning power of ‘opinion leaders’, ‘media representatives’, and ‘local community activists’ due to the political atmosphere dominating the country in the aftermath of Gezi Events, ‘employees’ and ‘customers’ stand out as prominent stakeholders leaving ‘society’ behind. The 6 February 2023 earthquake in Turkey re-emerged the power of ‘civil society organizations’ and ‘activists’ in humanitarian aid distribution in times of crisis (as in the aftermath of the August 1999 earthquake). As such, it is reasonable to expect increased stakeholder recognition of ‘society’ and ‘civil society organizations’ in future sustainability reports.

The ‘employees’ have occupied by far the first place, followed by ‘customers’, ‘society’, ‘management’, and ‘business partners’. These groups, which can be defined as primary stakeholders, have a significant impact on the sustainable performance and survival of the organization (Eskerod et al. 2015). For instance, companies operating in industries closer to customers pay more attention to their public image as they are more visible and subject to stronger stakeholder pressures and expectations (Dias et al. 2019). In this regard, Ali et al. (2017) state that the CSR reporting agenda in developing countries is largely influenced by powerful stakeholders. This is because powerful stakeholders fulfill their interests at a high level. The industry-specific analysis reveals that B2C industries disclose more information on stakeholders than B2B industries. When the dominance of a particular stakeholder is measured by frequency, it is found that the salient stakeholder varies across industries. In B2C sectors, the primary focus tends to be on customers, whereas in B2B sectors, employees take on a more prominent role.

To clarify whether the frequency of key stakeholders identified in the reports is a window dressing tool without change in substance, the materiality issues determined by stakeholder engagement have been examined. Thus, it became clear whether the main stakeholders identified have a real influence on companies’ sustainability strategies and practices. The identification of ‘employees’ and ‘customers’ as the most salient stakeholders, and the expression of prioritized issues such as ‘occupational health and safety’, ‘diversity and equal opportunities’, ‘customer satisfaction’, ‘climate change’, and ‘talent management’ reflect the overlap between prioritized issues and most salient stakeholders (employees, customers, society, and management). These disclosures can be valuable to motivate employees, help attract new talent (Carmo and Miguéis 2022), and influence customer perception and satisfaction, which in turn positively influences relationship maintenance (Karagiannis et al. 2022). Valuing society, in turn, contributes to empathy among employees, emotional intelligence among leaders, and the development of a culture of servant leadership (Gaur 2022).

The list of stakeholders continues further with low disclosures for ‘suppliers’, ‘subcontractors’, ‘industry’, ‘seller’, ‘education and research institutions’, ‘civil society organizations’, ‘investors’, ‘financial institutions’, ‘public institutions’, ‘media’, ‘international organizations’, and ‘competitors’. Stakeholders are unequal and therefore divergence is even more pronounced among external stakeholders (Wroblewski 2019). Here, the government, regulatory authorities, politicians, and legislators play a core role in setting and implementing social and environmental policy frameworks and standards to achieve development goals and objectives (UN 2015). These stakeholders, defined as dormant stakeholders (Mitchell et al. 1997), have the power to impose their will on the company and impact CSR disclosure, but it is argued that this power is not exercised in the absence of a legitimate relationship or emergency (Şener et al. 2016). Latent stakeholders with legitimacy are referred to as discretionary stakeholders (Mitchell et al. 1997). ‘Civil society organizations’, ‘trade unions’, ‘pressure groups’, ‘writers’, and ‘artists’ can be classified in this category as they can influence the company’s image or customer perception (Indeed 2023).

The application of corporate governance principles to the social sphere is called social governance. Here, social stakeholders seek to improve the legitimacy of social institutions (Verdeyen et al. 2004) and consultants, auditors, and trade unions play an active role in monitoring and promoting specific sustainability practices (Larrinaga and Bebbington 2021). Many of them often serve as advocates or representatives of the most vocal stakeholder groups (Indeed 2023). Companies that are simultaneously high performers in both the market and society face fewer frictions and problems in their business relationships with suppliers, traders, public authorities, and other stakeholders (Herzig and Schaltegger 2011).

‘Credit rating agencies’ that assess a company’s creditworthiness have been reported since 2009. Organizations such as the Dow Jones Sustainability Index (DJSI), the FTSE4Good Global Index, or the Ethibel Sustainability Index (ESI) (Lu et al. 2019) analyze CSR-related information and disclose companies’ CSR performance. Improvement in performance increases ratings (Attig et al. 2013). Despite the high impact of credit rating agencies, the study found limited disclosures in the Turkish context. Another surprising finding is that ‘competitors’, which have an important role in influencing firm behavior (Abreu et al. 2021; McCarty 2023), were the least disclosed in both sectors. According to Wood (2013), competitors considered as external stakeholders, try to predict what their rivals will do and how customers will react. They are also aware that a strong industry is in the interest of all competitors. Therefore, stakeholder groups such as ‘rating agencies’, ‘investors’, ‘vendors’, ‘financial institutions’, and ‘competitors’ need to be further investigated under Turkey-specific conditions.

This should not be seen as specific groups taking the lead while others lag behind. All stakeholders have a right to access information about an organization’s practices, commitments, and performance (Higgins et al. 2020). The stakeholders identified and the information disclosed should be considered as representative of the whole. The principle of inclusiveness is an important dimension, defined as involving stakeholders in developing and realizing an accountable and strategic response to sustainability (AccountAbility 2015). The information provided for society addresses efforts to mitigate adverse effects on the environment and society (Akisik and Gal 2019), whereas the information for investors serves as a tool to gauge credit risk and consequently shareholder returns (García-Sánchez and Noguera-Gámez 2017).

In this country-specific study, ‘activists’ were not identified as stakeholders. Organizations determine stakeholders based on their marketing strategies, recruiting, and investment plans (Grunig and Repper 1992), and activists have been mostly seen in an adversarial role relative to other organizational stakeholders (Harrison and John 1996). Activists should not be limited to NGOs and trade unions, as they can occur between all stakeholders. Activists, defined as special interest groups that emerge on their own around an organization to create some kind of change around a specific issue of interest (Davis 2007) are more effective at influencing adoption indirectly by transforming organizational spaces than by directly influencing company managers (Carberry et al. 2019). For example, the construction industry is of great importance for Turkey because of the added value it provides to the economy and the employment possibilities it creates for society (Statista 2023). In 2020, the sector employed 1.5 million people, accounting for 30% of the overall economy and 5.4% of total GDP (FIEC 2023). In this regard, it is necessary to draw attention to subcontracting (Article 2/6–7 of Labor Law No. 4857), which has been known as a dominant form of employment since the 2000s and has led to significant problems and consequences for the workforce such as low wages, precariousness, occupational accidents and occupational safety (Arı and Engin 2018). However, the findings of more recent reports on the construction and information technology, and electricity sectors suggest that these sectors did not engage in reporting practices from the outset. The finding of Marques et al. (2018) that stakeholder management is an uncommon practice among construction companies in Brazil may shed light on this issue. Another reason may be the weak and late institutionalization of the sector (ERAI Turkey, 2020). However, the fact that environmental impacts are generally negative and social issues such as occupational accidents cause physical, social, and economic problems requires civil organizations and environmental activists to take a more active role in raising awareness of social and environmental issues (Karaman et al. 2018). And if ‘activist’ perspectives representing dissent and transparency are disclosed in future reports, stakeholders might have more confidence in corporate social, environmental, and governance commitments. In this context, future generations can also be expressed. In 1987, the World Commission on Environment and Development referred to future generations by defining the sustainable development goals (WBCD, 2002), but despite all regulations, and legislations future generations started to be listed as stakeholders in 2019. Since future generations cannot voice their concerns, decision-makers must look beyond short-term political cycles and develop plans that take the lead on sustainable development issues (Robinson, 2017).

Conclusion

This study examines disclosed stakeholders in sustainability reports of companies operating in Turkey in a longitudinal context. The classification is an essential step in the process of stakeholder identification as it presents the hierarchy among stakeholders and helps to see the line between primary and secondary stakeholders. Overall, the results show that ‘employees’, ‘customers’, and ‘society’ have increasingly gained salience and become the major stakeholders of corporate social performance, which can be explained by the changing role of stakeholders and issues over time. It is important to highlight that the landscape of stakeholder disclosures has evolved over time. In 2007, ‘society’ held the position of the second most disclosed stakeholder group, but this has since shifted, with ‘customers’ now taking precedence in recent disclosures. The prioritization of customers in these disclosures may be indicative of a greater emphasis on financial value creation at the expense of social value.

It is essential to recognize that the dynamics of stakeholder influence can fluctuate in response to external events. For instance, following the August 1999 earthquake, the influence and impact of ‘civil society organizations’ and ‘activists’ in the distribution of humanitarian aid during times of crisis were reaffirmed. This phenomenon resurfaced with the February 6, 2023 earthquake, indicating the enduring influence of ‘civil society’ in Turkey. The resurgence of ‘civil society’ power in Turkey has the potential to influence the perception and recognition of ‘society’ and ‘civil society organizations’ as significant stakeholders in future sustainability reports. These findings have generated a research agenda aimed at contributing to the existing body of literature, providing recommendations for future research directions, and fostering further scholarly investigation. Study limitations should also be taken into account. The inclusion of organizations in both the BIST Sustainability Index and the BIST Corporate Governance Index limited the data set. As a first suggestion, future studies could identify companies and analyze sustainability reports without index limitations. Nevertheless, the study relies solely on content analysis of stakeholder representation and certainly calls for further empirical research based on case studies and interviews. The study has further contributions. First, by presenting the stakeholder inventory in Turkish businesses, this study may contribute to the understanding of stakeholders in the Turkish context, as it provides a framework and evidence-based analysis for decision-makers and policymakers. Second, companies should improve their CSR performance by developing a dialogue with more inclusive stakeholders and implementing diverse policies that aim to contribute to the well-being of current and future generations.

The findings of this study guide future research. Future research could extend this study by examining reports of companies operating in developed and/or developing countries, or companies operating in similar and different national cultures, and comparing stakeholder analyses in a more theoretical context to understand whether the social-cultural context influences organizations. In Turkey, sustainability reporting is not a precondition for a company to be listed in the BIST Sustainability Index, but despite this, companies have turned to more strategic issues than traditional practices. In this case, the factors that enable companies to develop sustainability practices and to be listed in the BIST Sustainability Index can be analyzed.

While sustainability reporting in the Turkish context has become more comprehensive over time, there are still significant gaps in the reporting of specific sectors such as consumer trade, information technology, construction, and electricity as well as of stakeholders such as competitors, international organizations, investors, NGOs, activists, media, and financial and public institutions. Addressing the pressures, expectations, and concerns of these groups in future corporate reports will make a significant contribution to building trust in governance as well as sustainability issues, not only in Turkey but also on a global scale.