Sustainability Accounting Practices and Their Impact on Corporate Reputation: Evidence from the Circular Economy Model

Abstract

This study investigates the relationship between sustainability accounting practices and corporate reputation, with a focus on the circular economy model. The circular economy emphasizes resource efficiency, waste reduction, and product lifecycle management as sustainable alternatives to the traditional linear economic model. By employing a mixed-methods approach, this research combines quantitative survey data from 200 companies and qualitative insights from 30 interviews with sustainability professionals across Europe, North America, and Asia. The findings reveal a significant positive correlation between sustainability accounting practices and corporate reputation metrics, with companies adopting circular economy principles achieving a 15% higher average in reputation scores. Regression analysis indicates that circular economy adherence accounts for 42% of variance in corporate reputation, underscoring its strategic importance. Qualitative results highlight transparency, stakeholder engagement, and leadership commitment as key factors driving reputational benefits, while challenges such as financial constraints, expertise gaps, and inconsistent reporting standards hinder adoption. The study further identifies industry and regional variations, with developed economies and sectors like manufacturing leading adoption rates, while emerging markets face infrastructure and regulatory barriers. The research contributes actionable insights, advocating for harmonized sustainability reporting frameworks, capacity-building initiatives, and affordable implementation strategies to promote the transition to a circular economy. Ultimately, this study underscores the critical role of sustainability accounting in fostering corporate reputation and advancing global sustainability goals.