Received: 17 January 2023 Revised: 4 June 2023 Accepted: 11 June 2023
DOI: 10.1002/csr.2554
R E S E A R CH A R T I C L E
Institutional pressures and accountability processes in pursuit
of sustainable development goals: Insights from Ghanaian
indigenous oil companies
Lexis Alexander Tetteh1 | Cletus Agyenim-Boateng2 | Samuel Nana Yaw Simpson2
1Department of Accounting, Faculty of
Accounting and Finance, University of Abstract
Professional Studies, Accra, Ghana This paper aims at exploring the institutional pressures and accountability processes
2Department of Accounting, Business School,
University of Ghana, Accra, Ghana in pursuit of sustainable development goals (SDGs) in indigenous oil companies in
Ghana. Applying a qualitative research strategy, semi-structured interviews with
Correspondence
Lexis Alexander Tetteh, Department of 20 company managers and other industry stakeholders were used to collect in-depth
Accounting, Faculty of Accounting and and rich empirical data. In pursuit of the SDG agenda, the indigenous oil companies
Finance, University of Professional Studies,
Accra, Ghana. appear to be sensitive to both internal and external stakeholder pressure. However,
Email: tetteh.lexis@upsamail.edu.gh the coercive pressures from regulators did not always result in the companies imple-
menting actual change. Instead, coercive pressures from non-governmental actors
have taken on the role of ‘regulator’ of organisational practices. Also, internal forces
of change were mainly the foreign partner's audit pressure and management commit-
ment to enhance company reputation. Beyond the institutional pressures to incorpo-
rate SDGs into business practices, the finding adds fresh perspectives to the three
logical steps of SDG accountability processes used by the companies to track their
contribution to SDG implementation and reporting, namely: data collection, SDG per-
formance measurement, and communication of SDG outcomes. Finally, the study dis-
covers that the companies are making little progress towards the achievement of the
SDGs because of financial limitations, rigid organisational environments that prevent
change, and a lack of a standardised institutional framework. The findings suggest
that in order for an organisation to gain legitimacy, its SDG agenda must incorporate
the concerns of non-governmental actors and local communities into its corporate
decision-making. Failure to meet the needs of these essential stakeholders may
jeopardise the legitimacy of organisation which will threaten its survival.
K E YWORD S
accountability, institutional pressures, non-governmental actors, SDGs, sustainable development
1 | INTRODUCTION contribution to the Agenda 2030, need to achieve. According to the
suggestions made by the Global Reporting Initiative (2016), the pri-
The United Nations member states reached an agreement in 2015 to mary reasons for adopting the SDGs are to combat inequality, find
adopt the new 17 Sustainable Development Goals (SDGs), which suc- solutions to poverty, and ensure inclusive development for all.
ceeded the Millennium Development Goals (MDGs). The SDGs are The adoption of SDG in 2015 had sparked public and private insti-
overarching goals with targets that all countries, as part of their tutional adjustments. These reforms affect corporate transparency,
Corp Soc Responsib Environ Manag. 2023;1–19. wileyonlinelibrary.com/journal/csr © 2023 ERP Environment and John Wiley & Sons Ltd. 1
2 TETTEH ET AL.
especially on sustainable development (Erin et al., 2022; Martínez- Furthermore, existing research suggests that incorporating SDGs
Ferrero & García-Meca, 2020). The adoption underlined nations' worries into business operational models and disclosing the practices in corpo-
about developing the environment in a way that is good for all people. rate reports is inadequate (Erin et al., 2022; Heras-Saizarbitoria
In recent years, the oil and gas (O&G) industry has been called to also et al., 2022; Ite, 2018; Mojarad et al., 2018; PwC, 2019). Likewise,
consider its involvement in broader ecological concerns (Narimissa various interest groups, such as civil society organisations (CSOs), reg-
et al., 2020). ulators, international organisations, non-governmental organisations
Despite being a driving force behind global economic growth, the (NGOs), and environmentalists have all advocated for corporate orga-
O&G industry is known for endangering the environment, destroying nisations to identify major SDG targets, integrate them into their
habitats, and having a negative impact on the livelihood of communi- business models, and report on their success and challenges
ties near operation sites of these companies. A growing interest in (Bebbington & Unerman, 2018; Erin et al., 2022).
sustainability issues of these companies has been sparked by their dis- Also, Erin et al. (2022) and Heras-Saizarbitoria et al. (2022) have
ruption of environment and the realisation that petroleum is a non- advocated for paying attention to the institutional and stakeholders'
renewable energy source (George et al., 2016). For instance, a study pressures that inspire corporate entities to commit to SDGs imple-
conducted by Verdantix (2014) discovered that O&G companies are mentation and reporting. To respond to the calls from Erin et al.
investing more money in sustainability-related activities like environ- (2022) and Heras-Saizarbitoria et al. (2022), this paper employs quali-
mental restoration and industrial energy management. However, such tative technique to unravel the viewpoints of the major stakeholders.
expenditures, according to Lozanova (2014), do not represent a con- Therefore, this paper explores the institutional and stakeholders' pres-
certed effort to embrace sustainability because the practices do not sures that drive O&G firms to commit to SDG implementation and
address broader ecological concerns, indicating a clear lack of reporting and the accountability processes put in place to track the
accountability in pursuit of such reforms. Further, in recent years, efforts of companies to attaining the SDGs. The paper focuses on
O&G companies have been criticised for allegedly engaging in ‘green Indigenous Oil Companies (IOCs) in Ghana. The study's theoretical
washing’ in their corporate reports and marketing efforts (George lens combines the Institutional Theory and Stakeholder Theory.
et al., 2016), and their sustainability practices and policies have been Companies' actions and inactions towards SDG implementation
questioned. For instance, these companies promote the advantages of and reporting cannot be fully explained through the three mechanisms
new energy sources while concealing the hidden trade-off by drilling of coercive pressures, mimetic processes, and normative pressures
for oil in unexplored areas and destroying natural habitats and biodi- (Eriksson & Lundberg, 2022; Herold, 2018). The role of different insti-
versity (de Freitas Netto et al., 2020). tutional contexts (or institutional complexity) in determining how
Other studies, however, have found that some of the corporate companies respond to institutional pressures for SDG practises and
entities in the O&G industry are demonstrating their commitment to reporting necessitates an understanding of the stakeholders who
sustainable development in their business development strategies by exert pressure on the IOCs to comply with generally accepted SDG
involving all stakeholders in the value creation process (see, practices and whose interests the management of the IOCs tends to
e.g., Ite, 2018; Mojarad et al., 2018; Gerged & Almontaser, 2021). serve. These relationship dynamics represent not only a daily battle
Consequently, the recent pressure from stakeholders to incorporate between the management of the company and stakeholders outside
sustainable development into national agendas and business strate- the company, but also a field of struggles between actors within the
gies, as well as the academic debate about the necessity of transform- organisational field that connect industry-level pressures and firm-
ing our planet by leaving no one behind, have sparked an interest in level actions. Thus, our understanding of what influences the IOCs
studying SDG implementation and reporting (García-Meca & management choice of SDG practises, as well as the extent to which
Ferrero, 2021). In order to substantiate this assertion, Caiado et al. these practises are implemented and reported is accordingly expanded
(2018), Mio et al. (2020), and Bennich et al. (2020) reviewed scholarly by the linking of stakeholder theory and institutional theory in this
articles and offered proof of a lack of comprehensive information on study.
how organisations interact with the SDGs. The IOCs were selected as the preferred research setting because
For instance, existing academic and policy researches have Mojarad et al. (2018) report that most local oil corporations fail to
focused on the role of global and national governance in attaining the implement the SDGs. While a number of multinational O&G compa-
SDGs (McKeon, 2017), with contributions on national projects (see nies may have adopted integrated thinking as a strategy to connect
Abhayawansa et al., 2021; Michel, 2016; Tetteh et al., 2023). Some their business models to the economic, social, and environmental pri-
studies have also identified how government accountability systems orities of their stakeholders in order to create long-term value for all
are crucial to the national implementation of the SDGs (Abhayawansa those affected by their operations (Arena, Azzone, Ratti, Urban, &
et al., 2021; Lauwo et al., 2022; Michel, 2016). However, empirical Vecchi, 2023), local oil companies are typically not subject to the same
study on corporate business integration and reporting of SDG activi- practices and reporting requirements. Furthermore, while both multi-
ties and their contribution to attaining the SDGs has just recently national and local O&G companies face regulated financial reporting
appeared in accounting literature (Erin et al., 2022; García-Meca & pressure, their voluntary environmental, social, and governance prac-
Ferrero, 2021; Ite, 2018; Lu et al., 2021). tices differ due weak enforcement of national regulations in
TETTEH ET AL. 3
developing (Suleman & Zaato, 2021) or a lack of pressures from In order to address these research questions, this study adopted
salient stakeholders. the exploratory qualitative approach by employing the interpretivist
In addition, little is known about the precise enabling and con- paradigm to extend our knowledge in SDG implementation and
straining factors of these local oil companies' SDG implementation, as reporting of IOCs in Ghana. More importantly, this study is a response
well as the accountability mechanisms put in place to track the pro- to the calls for more engagement in SDG issues through qualitative
gress being made towards achieving the SDGs. However, for multina- lens (Abdalla & Siti-Nabiha, 2015; Erin et al., 2022; Heras-Saizarbitoria
tional oil companies, there is a wealth of research available (see, et al., 2022; Ismaeel & Zakaria, 2019).
e.g., Abdalla & Siti Nabiha, 2015; Amodu, 2020; Abdul, 2020; Arena This study was conducted in Ghana because, since 2016, all of
et al., 2023). the country's presidents have served as co-chairs of SDG Advocates
Finally, the most recent research on the subject matter used a quan- as a result of institutional and regulatory reforms they implemented
titative approach to execute the study (see Erin et al., 2022). However, (Acheampong et al., 2019; Tetteh et al., 2023). In addition, Ghana per-
research based on mathematical robotism do not give the respondents formed best among 34 African countries in reaching SDGs according
the opportunity to explain the rationale behind their practices and why to a poll (Coulibaly et al., 2018). Further, as part of localising the
certain aspects of SDG integration and reporting were taken for granted. SDGs, Ghana prepares an SDG Budget Baseline Report. This report
Thus, the level of interest currently observed, coupled with the calls includes frameworks to align national budget priorities with SDG
from International Federation of Accountants (IFAC) for SDG implemen- goals. The SDGs Budget Report provides metrics that the government
tation (IFAC, 2017) and the International Integrated Reporting Council and its partners can use to measure progress on the various goals ver-
(IIRC) for integrated thinking and reporting to create long-term value for sus investments made over the years (Ghana's 2022 Voluntary
all stakeholders (Adams et al., 2020; Bernardi & Stark, 2018), present a National Review Process).
superb opportunity to investigate the implementation and reporting of The rest of the paper is organised as follows: Section 2 sets out
SDGs in IOCs to respond to these calls and to also offer a novel contri- the literature review. Section 3 presents the methodology. Section 4
bution in the context of IOCs' contribution to the realisation of the and 5, respectively, present and discuss the findings. The conclusions,
SDGs by addressing the following research questions: contributions and directions for future research are discussed in
Section 6.
RQ1. What factors primarily influence the IOCs' com-
mitment to SDGs implementation?
RQ2. Which stakeholders are perceived by the man- 2 | LITERATURE REVIEW
agements of the IOCs to be exerting the most pressure
on the IOCs to commit to SDG practices, and how do 2.1 | Institutional and stakeholder pressures to
the IOCs respond to such pressures? engage in and report on SDG practices
RQ3. What accountability processes are used to track
an IOC's progress on contributing to the SDGs? Many researches, especially the positivists have studied the factors
RQ4. What obstacles prevent IOCs from implementing that contribute to strong commitment to social and environmental
and reporting SDG activities? practices by companies (Erin et al., 2022; García-Meca &
Ferrero, 2021). According to these studies, companies engage in sus-
Answers to these questions provide researchers and policymakers tainable development practices for many reasons. Some of which are
with a better understanding of the actual motivations that drive orga- maintaining legitimacy pressure (by adhering to rules, norms, and
nisations to engage in SDG practices that enable them to predict orga- values), meeting stakeholder expectations, boosting competitiveness
nisations' behaviour with regard to SDG implementation and and long-term revenues, and encouraging ecological responsibility.
reporting (Abhayawansa et al., 2021; Erin et al., 2022; Heras- These motivations for sustainable development practices dominate
Saizarbitoria et al., 2022). Furthermore, identifying the most salient the literature because the organisations care about their social
stakeholders in a company's commitment to the SDGs, as well as the responsibilities and values and meeting stakeholder expectations
processes for tracking that commitment, would help researchers, pol- (Deegan & Islam, 2014). The next three subsections will discuss how
icymakers, managers, and other stakeholder groups develop strategies the interconnections between institutional theory, stakeholder theory
that will effectively incentivise firms to commit to the SDG agenda and regulatory frameworks informed the development of our concep-
(Lauwo et al., 2022). Also, answers to the research questions adds to tual framework for the study.
the accounting literature in the field of sustainability accounting, as
well as how SDG issues are integrated into corporate entities' busi-
ness models and sustainability reports. Finally, this study shows how 2.1.1 | Institutional theory
stakeholder theory can be used in conjunction with institutional the-
ory to identify and investigate the respective roles of stakeholders Localisation of global reforms has been explained in the existing litera-
and actors, as well as their level of influence in the pursuit of SDG ture using Institutional Theory. According to Chen and Roberts
practices and reporting. (2010), the theory is ideal for exploring a common business practice
4 TETTEH ET AL.
used by similar organisations. This study uses this theory to examine the most powerful stakeholders to address institutional pressures.
the institutional pressures that drive local oil companies in Ghana to The SDGs and other social and environmental issues are addressed by
integrate SDGs into their business models, as well as the accountabil- organisations primarily in the pursuit of legitimacy, according to Insti-
ity processes used to track the progress of companies on contributing tutional Theory (Boiral et al., 2017). This claim is valid, particularly
to the SDG realisation. when organisations adopt practices that are seen as rational and righ-
Fundamentally, Institutional Theory looks into how external pres- teous by their stakeholders in an effort to gain their support and legit-
sures can lead businesses to adopt particular organisational practices imacy. Adoption of SDGs increases the operation of organisations on
(DiMaggio & Powell, 1983). According to institutional scholars, the insti- social licence (Diaz-Sarachaga, 2021). This imply that when the legiti-
tutions that surround a company have a significant impact on how it macy of an organisation is threatened, its management takes defen-
behaves. These institutions include the cultural-cognitive, normative, sive measures to limit the harm by responding to powerful
and regulative structure that give social behaviour stability and a collec- stakeholders. This shows that organisational responses to SDG prac-
tive meaning (Scott, 2013). In other words, Institutional Theory is tices and reporting will differ based on institutional pressures and pri-
founded on the notion that social interactions and institutional pressures orities of managers for stakeholder claims.
have an impact on how organisational actions or practices are developed The legitimacy and survival of the Ghanaian O&G industry are
(North, 1990). This study makes the case that once a social fact is insti- also threatened by institutional pressure. For instance, CSOs, espe-
tutionalised, it gives businesses actionable templates that lead to unified cially social and environmental NGOs with strong stakeholder pres-
or homogeneous responses and thus more likely to be accepted. For ence in the country, have always scrutinised and pressured the oil
instance, companies adopt SDG logic in response to external pressures firms. They frequently exert pressure on them to be socially and envi-
to participate in and report on SDG information. When a company ronmentally responsible in accordance with SDG targets. This
implements and communicates SDG practices to relevant stakeholders, strengthens the argument that NGOs have symbolic legitimacy and
the SDG logic becomes part of the organisation's meaning system. power as a result of their reputation in society and the trust they have
The primary justification for adopting the logic and incorporating earned by promoting the common good (Deegan & Islam, 2014).
it into the business model and reporting is to gain or maintain legiti- On various levels, Institutional Theory has limitations (North, 1990).
macy (Erin et al., 2022). According to DiMaggio and Powell (1983), More recent Institutional Theory studies acknowledge that the emphasis
the adoption of logic or institutional practices is accomplished through has shifted away from dynamics that encourage conformity in organisa-
three main isomorphic mechanisms: coercive pressures, mimetic pro- tional behaviour and towards dynamics that promote heterogeneity, var-
cesses, and normative pressures. iation, and change. However, Institutional Theory is unable to offer a
The first type is coercive isomorphism. This occurs when local oil theoretical basis for categorising stakeholders and their level of influ-
companies follow formal and informal influences from regulatory ence and this makes it difficult to explain the roles of actors with com-
authorities or those perceived to be powerful/salient stakeholders peting interests (Herold, 2018; Kostova et al., 2008). In view of this
(Scott, 2013). Governmental pressure is an example of coercive iso- difficulty, Stakeholder Theory must be incorporated into Institutional
morphism. Governments are typically legitimate and powerful stake- Theory to categorise actors or stakeholders who are salient in advancing
holders with the ability to exert influence through legislation, the SDG agenda in the industry in order to examine the influences on
regulation, and policies (Erin & Asiriuwa, 2019; North, 1990). IOCs to engage in and report on SDG practices. An overview of Stake-
The second type is mimetic isomorphism. It happens when local holder Theory and the traits used to classify stakeholders is given in the
oil companies are unsure what to do and end up mimicking successful following section.
industry players (Sancha et al., 2015). The third type is normative iso-
morphism. Normative isomorphism is defined as pressures from social
institutions such as business associations, NGOs, CSOs, or the media. 2.1.2 | Stakeholder theory
These organisations raise public awareness in many countries and
industries around the world (Anderies et al., 2013). All these three iso- According to this theory, organisations must balance a variety of
morphic pressures explain how institutional pressures affect organisa- stakeholder expectations and interests that can affect or be affected
tional behaviours and structures (Erin & Asiriuwa, 2019; Scott, 2013). by the actions of the organisation in addition to being accountable to
In terms of SDG localisation, the Institutional Theory has been investors and funders (Friedman & Miles, 2006; Simoni et al., 2020).
used to explain accountability for SDGs research (Abdalla & Siti Therefore, in order for an organisation to be legitimated by its stake-
Nabiha, 2015; Erin et al., 2022). Therefore, the importance of this the- holders, those stakeholders must view the behaviour of the organisa-
ory in achieving the 2030 Agenda for sustainable development cannot tion as appropriate (Hrasky, 2011). The main claim of Stakeholder
be overemphasised. For instance, IFAC (2017) is of the view that reg- Theory is that the support of stakeholders is essential to the long-
ulatory institutions and stakeholders perceived to be powerful are pri- term survival of the company, and managing the needs, expectations,
mary drivers that can tackle SDG challenges within corporate and competing interests of these stakeholders is a key responsibility
organisations. In attempt to address the institutional pressures from of business management.
various stakeholders within the surrounding environment, Oliver A business needs the support of its main stakeholders, including
(1991) also holds similar view that the corporate entity responds to shareholders, employees, clients, and suppliers, in order to succeed,
TETTEH ET AL. 5
according to Clarkson (1995). These stakeholders provide the infra- execute and report on their sustainable development practices (Boiral
structure and legislative frameworks required for the operation of the et al., 2017; Erin et al., 2022; García-Meca & Ferrero, 2021; Heras-
business. The company does not view secondary stakeholders like the Saizarbitoria et al., 2022). Similarly, the study of Abdalla and
media and special interest groups as being crucial to its survival. Siti-Nabiha (2015) found senior management, foreign partner audit
Mitchell et al. (1997) developed a commonly used framework to processes, and the companies' need to protect their reputation also
define the salience relationships of stakeholders, which has since been exert internal pressure on companies.
widely utilised by both practitioners and researchers. They contend Such reputational management practices are frequently linked to
that stakeholder identification and salience are influenced by the greenwashing (Boiral et al., 2017; Heras-Saizarbitoria et al., 2022).
stakeholder's possession of one or more of the following relationship According to Bebbington and Unerman (2018), the SDGs could be used
attributes: (1) the stakeholder's power to influence the firm, (2) the ‘to camouflage business-as-usual by disguising it using SDG-related sus-
legitimacy of the stakeholder's relationship with the firm, and (3) the tainability rhetoric’ (p. 10). In fact, phrases like ‘rainbow-washing’ and
urgency of the stakeholder's claim on the firm. ‘SDG-washing’ have been developed in the academic literature to
The power attribute manifests itself in numerous ways in real life. describe the symbolic rather than actual commitment to the SDGs
It can take the form of coercion, or so-called coercive power, which (e.g., Heras-Saizarbitoria et al., 2022; Mio et al., 2020).
refers to the application of physical force, violence, or restraint. As Whatever the motivation or stakeholder influence for corporate
opposed to normative power, which is based on symbolic resources. organisations to engage in sustainable development practices and
Utilitarian power is based on financial and material resources (Alves make disclosures of the key successes, the overarching rationale is to
et al., 2014; Mitchell et al., 1997). build or protect their reputation in order to generate more revenue.
Legitimacy, the second characteristic, pinpoints the stakeholder These various mechanisms to identify and categorise stakeholders can
who requires the manager's attention; however, if this characteristic is be viewed as a first step towards establishing a theoretical basis for
emphasised in isolation from the power characteristic, the theory fails investigating why the management of IOCs chooses different
to convey its intended significance. Dong et al. (2014) point out that approaches to SDG implementation and reporting. This theory also
even though certain stakeholders' interactions may be accepted as helps to unearths which stakeholders are perceived by the manage-
legitimate, and this does not mean that they have any sway over the ments of the IOCs to be exerting the most pressure on the IOCs to
group as a whole. Legitimacy can also mean that a company's actions commit to SDG practices.
are acceptable and appropriate in relation to a set of rules, norms,
principles, and definitions (Alves et al., 2014). This method may be
used at various levels of analysis from an individual to a societal level 2.1.3 | Regulatory frameworks for legitimising SDG
(Adongo & Kim, 2018). However, this study only takes an organisa- integration and reporting
tional approach to the legitimacy attribute.
However, the dynamics of how interested parties interact do not Laws and regulations have also been found to drive companies to
only result from the recognition of power and legitimacy traits. The implement these practices more than anything else (Abdalla & Siti
third characteristic, urgency, assumes that the relationships between Nabiha, 2015; Unerman & Bennett, 2004). In developing countries
these groups will change from a static to a dynamic form, and it sug- such as Ghana with little institutional capacity and inadequate regula-
gests greater influence in these audiences' claims (Alves et al., 2014). tory governance (Mzembe & Meaton, 2014; Suleman & Zaato, 2021),
The urgency attribute highlights the ability of stakeholders to define CSOs and NGOs take on ‘regulatory’ duties to urge business organi-
their level of sensibility, criticality, and pressure in order to apply pres- sations to be accountable (Deegan & Islam, 2014). Companies in
sure on company managers to pay attention to their claims (Mitchell developed countries, on the other hand, may face different pressures
et al., 1997; Şener et al., 2016). In addition to being socially con- to achieve the SDGs due to their level of economic growth, knowl-
structed, the characteristics of power, legitimacy, and urgency that edge, culture, and technology (Hossain et al., 2012).
are generated in interactions between businesses and their interested Companies may preserve stakeholder trust by being accountable
parties are likely to vary and may be consciously and intentionally pre- and giving more information on how they address complaints
sent in relationships between stakeholders and business management. (Ismaeel & Zakaria, 2019), through the use of framework such as
The actions taken by the companies in regards to SDG implementa- Global Reporting Initiative (GRI), PricewaterhouseCoopers (PwC), and
tion and reporting become tense and complicated as a result. International Integrated Reporting Framework (<IR>) (Erin et al.,
In emerging economies, there have been few studies on why cor- 2022). In order to ensure that a wider range of issues are reflected in
porations integrate and disclose their SDG practices, especially a sustainability report of a company, the GRI framework was devel-
research that uses information from internal and external stakeholders oped in consultation with numerous stakeholder groups from around
(Abdalla & Siti Nabiha, 2015). Islam and Deegan (2008) found that the world. This makes the guidelines applicable to a large number of
multinational firms, Western consumers, NGOs, and the media organisations, including small businesses, NGOs, large Multinational
encourage organisations to improve their sustainable development National Corporations, and public sector organisations. Many scholars
practices. Other scholars have also found an internal factor such as believe the GRI is the most frequently used framework for reporting
image/reputation building to influence how business organisations on SDG practices (see e.g., Erin et al., 2022; Heras-Saizarbitoria
6 TETTEH ET AL.
et al., 2022; Ioannou & Serafeim, 2017). The new GRI framework pub- accountability processes are crucial (Adams et al., 2018; Heras-
lished in 2018 aims to strengthen SDG integration and reporting by Saizarbitoria et al., 2022).
including environmental and social challenges (Adams, 2020). Bottom-up approach proponents as advocated by George et al.
The second framework considered in this study is the <IR> (2016) required that businesses adopt KPIs that address the impact or
framework. The framework helps businesses improve their stew- consequence of their activities when incorporating the SDGs into
ardship and accountability for six types of capital (financial, manu- their business processes. However, Abdalla and Siti Nabiha (2015) dis-
factured, intellectual, human, social and relationship, and natural) covered that some of the SDGs are difficult to achieve due to a lack
(IIRC, 2015). The reporting framework includes five steps. First, of appropriate data. To overcome this challenge, George et al. (2016)
understanding the organisation's external sustainable development draw the conclusion that all organisational functional areas must
issue. Second, identifying the SDGs that impact the company's gather SDG data on characteristics of greenhouse gases, energy,
value. Third, incorporating into the design of a business model to water, and biodiversity, among others, to enable the realisation of the
adopted SDG targets. The fourth, cultivating integrated thinking as SDGs in manufacturing organisations. This implies that, in order to
well as connectivity and governance. And finally, putting together a realise the SDGs, entities must further develop KPIs for the SDG tar-
report that encompasses performs over the year (IIRC, 2015). While gets that can be used to track implementation and inform stake-
GRI offers a comprehensive set of indicators to assess how a busi- holders of the results. Thus, collecting data, measuring performance,
ness actions affect the Triple Bottom Line, <IR> framework focuses and reporting on the outcomes of SDGs implementation is vital to
on the relationship between business strategy and the sustainabil- accomplishing SDGs.
ity performance of the business with a particular emphasis on how
the business creates long term value through the activities it
undertakes. 2.3 | Theoretical framework
The third framework identified in the literature is the PwC frame-
work. This framework outlines a four-step procedure to strengthen The theoretical framework for the study is presented in Figure 1.
SDG-related core value activities (Erin et al., 2022). The guidelines The theoretical framework of this study is based on Institutional
emphasise that the first step is for companies to admit that sustain- Theory and Stakeholder Theory. The general idea behind the
able development is about more than corporate social responsibility Stakeholder Theory in this framework is that IOCs must consider the
(CSR) and that every aspect of the entity contributes to its success. interests of the entire stakeholder groups in their own business activi-
Second, the Chief Executive Officer (CEO) and other key executives ties not just those of shareholders. Therefore, the survival of the IOCs
must be interested in executing the SDGs. Third, the entity must is contingent on their capacity to manage stakeholder relationships in
define Key Performance Indicators (KPIs) to get things done and terms of aligning their practices with the attainment of the SDGs. Fur-
report progress (PwC, 2019). thermore, the instrumental perspective of Stakeholder Theory spec-
All the discussed frameworks advise businesses to evaluate the ifies how organisations, including IOCs, interact with their
SDGs to decide where they can have the biggest impact and then stakeholders based on their salience (Dong et al., 2014) in order to
establish appropriate targets. It has been demonstrated that the gain legitimacy to operate (Deegan & Blomquist, 2006). As a result,
frameworks that have been discussed above are significantly more this viewpoint necessitates that the IOCs consider the risks and
effective in gaining acceptance from regulators, as well as popularity opportunities presented by the salient stakeholders in order to capi-
with CSOs, NGOs, or investors. In conclusion, it is clearly evident that talise on the strategic opportunities available when implementing and
the frameworks have made a contribution to the legitimization and reporting on SDG practices.
integration of SDG as a practice. Surprisingly, despite the fact that the The framework also depicts that the integration of the SDGs into
frameworks have been adopted by many developing countries, the business practices as well as the potential for reporting and disclosing
impact on development has been minimal. the SDG outcomes will be influenced by external forces such as coer-
cive, normative, and memetic mechanisms from regulatory institu-
tions, professional bodies, government, CSOs and NGOs. Similarly,
2.2 | Accountability processes for tracking SDG internal forces such as top management support, skilled staff, and
practices oversights from parents of joint venture companies, among others,
are likely to also influence SDG implementation, reporting and
Most academic and policy researches have focused on the role of disclosure.
global governance in achieving the SDGs (McKeon, 2017) and the Also, stakeholder groups based on Mitchell et al.'s (1997) typol-
contributions of governments to national SDG projects (see ogy are likely to complement institutional pressures to influence the
Abhayawansa et al., 2021; Nygård, 2017). Meanwhile little attention IOCs to adopt, implement, and report on their SDG practices, as
has been paid to business involvement in advancing the targets shown in Figure 1. Dangerous stakeholders are those who hold power
enshrined in the SDGs (see Abdalla & Siti Nabiha, 2015; Adams and urgency although they may lack the legitimacy to back up their
et al., 2018; Cole & Broadhurst, 2021; Erin et al., 2022; George claims. In order to have their interests met, such stakeholders can be
et al., 2016). For a corporation to execute the SDGs in any jurisdiction, coercive or even violent in some cases (Şener et al., 2016). Hence, the
TETTEH ET AL. 7
F IGURE 1 Theoretical framework. Source: Authors constructs
IOCs need to place a high value on the interest of these most salient unearth, understand, describe, and interpret the meanings of the par-
stakeholders to legitimise their operations and stay in business. ticipants' actions in a natural setting, as the exploratory qualitative
The framework also demonstrates that institutional forces include approach is typically grounded in conversations. This view is further
both accountability processes can be used to track the OICs contribu- posited by Creswell and Poth (2016) that, a researcher using explor-
tions to SDG implementation and reporting. Similarly, institutional atory qualitative approach does not attempt to manipulate events
forces provide legitimising frameworks such GRI, <IR> and PwC that within a framework because this approach requires a naturalistic
shape companies' practices in order to address credibility gaps and to method centred on gaining understanding in a particular context in
also avoid sanctions. the real world.
Finally, Figure 1 also denotes that due to resource constraints The purpose of this study was to explore the institutional pres-
combined with other institutional and organisational factors, compa- sures and accountability processes in pursuit of SDGs in IOCs in
nies in the O&G industry may end up adhering to implementing and Ghana. The exploratory approach helped to provide detailed informa-
reporting SDG targets that ‘avoid harm’ rather than those that ‘do tion about participants' behaviours, emotions, characteristics, and
good’, thereby deviating from achieving the SDG Agenda of leaving preferences, among others, regarding SDG implementation and
no one behind. reporting; thus, highlighting emerging issues, ideas, and concepts dur-
ing the research, as proposed in the existing literature (Braun
et al., 2021; Bryman & Bell, 2015).
3 | RESEARCH METHODOLOGY In addition, since a qualitative approach involves natural data collec-
tion such as interviews or ethnography, this study used the interview
The investigation of the institutional factors that drive the indigenous method, taking relevant notes of actions, words, attitudes, and behav-
oil company to integrate and report on SDGs, as well as the account- iours throughout the study (Lewis, 2015). Twenty (20) semi-structured
ability mechanism deployed to track the company's contribution to interviews were conducted with selected managers of organisations
SDGs, requires an exploratory approach to the execution of the study. from various organisational levels and departments, as well as a variety
As a result, this study employs a qualitative technique to analyse the of external stakeholders, over a 13-month period, from September 2020
phenomenon. Tashakkori and Teddlie (2009) explain that researchers to October 2021. Since firm policies and operations impact so many dif-
employing the exploratory qualitative approach make an effort to ferent stakeholders (O'Dwyer & Owen, 2005), it was critical to explore a
8 TETTEH ET AL.
diverse range of viewpoints from stakeholders with diverse backgrounds TABLE 1 Respondents interviewed.
and expertise. Category of interviewee Rank Number
The interview method provides a thorough comprehension of the
Petroleum Commission of Ghana Senior officials 3
issue under consideration. Furthermore, there is a scarcity of pub-
Sustainability managers Senior managers 7
lished research on the subject in developing nations that employs
Departmental and unit heads Senior managers 7
interview-related techniques (Abdalla & Siti-Nabiha, 2015; Erin
CSOs and NGOs Senior advocates 3
et al., 2022). As a result, interviews were the primary data gathering
tool in this study. Majority of interviewers from within the organisa- Total 20
tion were from senior management (the Sustainability Managers and Source: Authors' construct.
the Heads of different departments and sections). Senior managers
were identified as a crucial source of rich information since they are
usually involved in the company's sustainable development decision- The exact number of participants interviewed was not predeter-
making (Rodrigue et al., 2013). The interviews with top management mined. Instead, the study agreed to interview as many participants as
members provided a more in-depth understanding of the pressures were required to achieve theoretical saturation (Guénin-Paracini
that the companies face and the accountability processes used to et al., 2015). The quality of qualitative research is evaluated based on
track the SDG integration and reporting. its trustworthiness (reliable and credible), as opposed to quantitative
External interviewees included government officials from relevant research, where reliability and validity are the two most important
regulatory agencies such as the Petroleum Commissions (PC). Further- indicators used to assess the quality of a study (Bryman & Bell, 2015).
more, members of CSOs and NGOs were approached for their view- To achieve trustworthiness, the production facilities of the chosen
points on the subject. The PC officials were relevant to this study IOCs that took part in the study were visited, and observations were
because the Commission is the regulator of the O&G industry in made throughout the visit. SDG documented information on the com-
Ghana and monitors whether the operations of O&G companies are panies' websites, social responsibility reports, illustrations of environ-
consistent with sustainable development practises. CSOs and NGOs mental impact assessment reports, and the legal and regulatory
are one of the important stakeholders this researcher contacted. Civil framework governing environmental protection were also sources of
societies in Ghana have led the way in pressuring government and information to achieve triangulation. All these sources were used to
corporate leaders to implement the SDGs due to lessons learned from triangulate the information provided by the participants, and where
the Millennium Development Goals and past restrictions on their discrepancies emerged, the participants were asked to clarify.
actions. Before the SDG implementation in Ghana, the Civil Society All of the interviews were recorded and transcribed in order to
Platform on Oil and Gas (CSPOG) was in constant contact with the increase credibility and prevent misunderstandings or misinterpretations
government. Ghana seeks participation of these non-governmental of the information provided by the interviewees (Bryman & Bell, 2015).
actors in SDG implementation to ensure localization and inclusion in The research findings presented in the following section were then orga-
corporate business models. In addition, this study included both the nised using the emergent themes. It is worth noting that the answers to
PC and non-governmental actors because laws, regulations and civil the research questions and the earlier accounting literature examined in
society pressures are found to be the main drivers of sustainability this study informed the emerging themes (Tetteh et al., 2023). Finally,
practices (Abdalla & Siti Nabiha, 2015; Lozano, 2015). follow-up interviews were conducted to get to the bottom of any unan-
The interviews were semi-structured and the questions were swered doubts (Walsham, 2006). See Appendix A for the interview
open-ended therefore, the interviewees did not always directly guide.
answer the questions. Furthermore, the interviewees addressed the Concurrent data analysis was carried out, and as the study pro-
same issue in multiple responses. As a result, identifying relevant gressed, emerging themes were investigated. The transcripts were
information was not limited to providing direct answers to the rele- double-checked for accuracy and read several times to fully compre-
vant question. Any mention of the issue by an interviewee was noted hend the participants' world. The information was coded, and similar
and taken into account. codes were combined to form themes and sub-themes. This data anal-
Some of the interviews took place at the workplace of inter- ysis procedure adheres to the principles of thematic analysis (Miles,
viewees while others were conducted through the use of zoom Huberman & Saldana, 2014). The approach used in the study was
video technology. Before conducting an interview with any of the inductive coding. Inductive coding is a bottom-up approach that
participants who took part in the study, a briefing on the objectives derives codes from data (Saldana, 2021). This is essential when con-
of the study was given to each of them individually. The participants ducting exploratory research or developing new theories, ideas, or
were also given the assurance that the information being gathered concepts (Saldana, 2021). The overall data analysis strategy was built
would be handled in a manner that would maintain the utmost level on thematic analysis. In this regard, the study adhered to the recom-
of discretion and privacy at all times. In summary, respondents were mendations of Braun and Clarke (2006, 2014): (1) becoming
trained professionals in their respective fields with a minimum of acquainted with the data, (2) generating initial codes, (3) searching for
6 years of experience and a maximum of 16 years. Table 1 lists themes, (4) reviewing themes, (5) defining and naming themes, and
respondents. (6) generating the report.
TETTEH ET AL. 9
To this end, the study classified the participants' unique opinions The agreement we sign with the government and inter-
and interpretations under the following themes: (1) Factors influenc- national oil companies mandates us to engage in sus-
ing the IOCs' commitment to SDGs; (2) accountability processes to tainable development or SDG practices and to disclose
track the IOCs' contribution to the SDGs; and (3) obstacles preventing them. For example, the agreement states that all laws
IOCs from implementing and reporting SDG activities. The next of Ghana including the demands of the Petroleum
section presents the empirical analysis. Commission should be adhered to… If we fail to com-
ply, the authorities will withdraw our licence, sanction
or slap the company with fines.
4 | FINDINGS
Losing an operating licence or paying fines for violating govern-
4.1 | Factors influencing the commitment of IOCs ment laws and regulations coerce indigenous oil companies to include
to SDGs implementation SDGs into their business models. These companies comply with the
requirements and present their SDG related reports to regulatory
The results of both external and internal institutional pressures that authorities, top management, and partners.
compel IOCs in Ghana to incorporate SDGs into their sustainable Again, the study discovers that the government's objective of
development policies are provided in this section. The section also encouraging foreign investment for the country's economic develop-
provides results of stakeholders perceived by IOC management to be ment conflicts with its priority of ensuring oil and gas businesses fol-
exerting the most pressure, as well as how the companies respond to low best sustainable development practices. According to Suleman
such pressures. and Zaato (2021), the Ghanaian government relaxes laws and regula-
tions to encourage domestic and foreign industry. A Ghanaian envi-
ronmentalist (ENV 1) had this to say:
4.1.1 | External factors influencing the commitment
of IOCs to SDGs implementation What they claim to be doing to encourage oil compa-
nies to incorporate SDGs into their business models is
The need to comply with operating permits and local laws and regula- a leap service. The government rather relaxes the
tions was the first external pressure that emerged from the collected enforcement of the law to generate more revenue
data. All O&G companies operating in Ghana, regardless of nationality, from the companies to address economic hardship in
must adhere to the laws and regulations of the host country. These the country.
companies are required to furnish the appropriate authorities with an
environmental impact assessment (EIA) report. Almost all oil compa- The overarching requirement for economic development stoked
nies have developed and implemented health, safety, and environ- competing institutional pressures on the companies, which in turn
mental (HSE) policies and procedures to comply with legislation and caused friction in their day-to-day operations. Is it about addressing
to localise the achievement of SDG related targets. One of the man- SDG goals on climate change, unemployment, or working towards
agers, SM4, in charge of the programme related to sustainable devel- alleviating poverty? As a result of the government's demand for
opment, raised the following point: increased oil production to generate more revenue for economic
development, compliance with the laws and the industry regulations
The government has been aggressive in ensuring that appears to be a secondary consideration.
all contractors including those under exploration and Responsibility for ensuring oil companies to integrate SDGs into
production sharing agreements pay special attention to their operational strategies rests not only with the government and
all environmental and sustainable development issues. industry, but also with a wide range of non-governmental actors such
The Environmental Protection Agency and other regu- as NGOs, think tanks, and academics who advocate for more account-
latory agencies are all urging strict adherence to activi- able governance and management in the O&G industry. Indigenous
ties that promote SDGs. companies are image-conscious due to the environmental sensitivity
of their operation. Rising sea levels, major weather disasters, and
The government's dedication to fighting environmental degrada- unpredictable environmental conditions make it more expensive and
tion and emissions influenced oil companies' social and environmental harder for O&G companies to operate in ecosystems they have dam-
initiatives that relate to the SDGs. The study also reveals that if a aged due to the practices. As a result of this, the non-governmental
company violates the oil-sharing agreement, the government may actors in Ghana have levelled accusation that the oil companies are
cancel that company's operating licences, implying that an O&G com- not operating in a sustainable manner (Ayanoore, 2021). This accusa-
pany may lose its operating licence if it does not follow rules estab- tion has resulted in local oil companies becoming more socially and
lished by the Energy Ministry, the Petroleum Commission, or the environmentally responsible.
Environmental Protection Agency. A head of departments, HD2 of Accusations have changed how local oil companies manage legiti-
one of the companies reveals that: macy gaps. After the SDGs were adopted in 2015, local oil companies
10 TETTEH ET AL.
realised they have a significant position in the national economy in parent companies as internal stakeholders who exercise control over
contributing to the SDG agenda. They swiftly design a new approach their technical and operational processes.
that combines NGO requests to legitimise their companies' social Surprisingly, local oil company with this arrangement followed their
licence to operate as a local oil company with the country's interests parent company's sustainability policies. The audit pressure from foreign
in mind. SM2, one of the companies' managers, revealed: partner is seen as internal pressure for companies to adopt SDGs. This
demand from parents of local oil companies has become an institutional
Well as a corporate entity, we are aware these NGOs driver for them to address sustainability challenges in their operations.
and CSOs are working had to make the world a more SM 4, one of the officials of the local companies emphasised the role of
sustainable place by spreading information about cli- parent companies to realisation of the SDGs as follows:
mate change, environmental sustainability, gender
equality at the work place, poverty alleviation in oil …I will say that our foreign partner acts as a change
communities and many more. Their voices are loud and agent to especially when it comes to addressing
failure to meet their demands they can damage the SDG-related issues in our operations. They sometimes
reputation of the firm especially when the media picks expect too much from the local firm during their audit
the matter up. when they know some of the ‘green’ production
equipment are expensive for a local firm to acquire.
Another manager (SM3) of one of the companies also empha-
sised that: The study also indicates that international partners of local oil
companies continue to monitor and implement SDG-related policies
Embedding SDGs into our company's practices is the in their subsidiaries to safeguard their image as partners to local firms.
way to go now if you don't want Civil Society Organi- This is noted since Ghana has many concerns that have captured the
sations like Think Thank and others to come after you. public's attention. Another officials SM1 illustrated:
They keep putting pressure on us, as if we've decided
not to act responsibly. Their accusations will continue, Since our foreign partners began auditing our sustain-
so we must do our best as well. ability practices, we have done a lot to meet their
expectations and the requirements of the industry reg-
According to the findings, non-governmental actors mount pres- ulators, which I cannot share with you all at this time.
sure on local oil companies to comply with environmental and social But our partner audits our company's health, safety
responsibility. The reputations of local companies will suffer if they do and environmental practices.
not comply. Again, it is realised that the actions of non-governmental
actors have an impact on the reputations of the companies. As a Foreign partners audit their partners to encourage them to adopt
result, the management of the companies respond to the concerns distinct identities in complex host countries. This protects the parent
raised by the non-governmental actors involved and acknowledge the firm from the local firm's harmful impacts. Foreign partners are wor-
necessity of altering their sustainability practices in order to conform ried about social and environmental issues and guarantee local com-
to acceptable standards. panies follow stringent procedures to maintain their brand, the study
found. Local companies' and their international partners' reputations
would suffer if they ignore social and environmental issues. As men-
4.1.2 | Internal factors influencing the commitment tioned by one of the officials (HD 2) of the companies:
of IOCs to SDGs implementation
Apart from our foreign partner, we have social licence
The emerging theme for internal pressures driving local oil companies to operate in Ghana so our management will always
to incorporate SDGs into their operational practice is pressure from insist we do what is required to protect our image …
the audit requirements of foreign partners. There is therefore the
need to safeguard the company's reputation, and the commitments Another source of coercive pressure for local oil companies to
made by the company's top management. The Ghana local content engage with SDGS is the need to protect the reputation particularly
policy and participation law, Regulation 4 (L.I. 224) requires foreign oil their foreign partners. Reputation is important for businesses because it
companies to form joint ventures with local firms and provide equity is a marketable asset that can be used in dealings with stakeholders
to local partners to obtain a licence in Ghana's oil and gas industry. (Abdalla & Siti-Nabiha, 2015; Heras-Saizarbitoria et al., 2022). The senior
The regulation also requires that Ghana National Petroleum Company managements of the companies care about health, social, and environ-
(GNPC) be a party to all Ghanaian upstream petroleum agreements. mental issues. The top managements of local oil companies are eager
Regulations 24 and 25 promote joint ventures between local and for- and understanding, and they know that social and environmental sus-
eign companies to facilitate technology transfer to Ghanaian firms (L.I. tainability are crucial to their commercial operations and ability to con-
2204). Due to this arrangement, some local companies viewed their tinue operating.
TETTEH ET AL. 11
4.2 | Accountability processes to track the Despite methodological hurdles, oil companies should set sustain-
contribution of IOCs to the SDGs able development targets that include all of their economic, social,
and environmental priorities. The studies also showed that some orga-
SDG integration or operationalization refers to the use of SDGs to nisations have not fully operationalised a data-collection procedure
guide the action of companies in their sustainability strategies across production/business practices. Some businesses focused on
(Mhlanga et al., 2018). This relates to the ‘how’ of SDG engagement areas that attracted public attention to build business cases and sat-
(Silva, 2021). SDGs could be integrated or operationalised in the orga- isfy powerful stakeholders, while the influence of selection processes
nisation in a measurable, accountable, and assessable manner, with on the SDGs was emphasised as an accountability challenge.
adequate monitoring and assessment systems in place (Heras-
Saizarbitoria et al., 2022). During interactions with company officials,
the following key areas relating to accountability mechanisms were 4.2.2 | Measuring performance on SDGs
discovered: (1) the collection of data pertaining to SDG integration integration
and performance; (2) the measurement of performance on the SDGs;
and (3) the communication of performance on the SDGs. Measuring the contribution of a company to the SDG integration was
another means of fostering accountability. Selecting KPIs and linking
them to outcomes helps drive, monitor, and communicate progress.
4.2.1 | The collection of data pertaining to SDG and This can serve as the basis for these activities. The integration and
mapping them to business practices measurement of performance of the SDGs with widely used frame-
works, such as those of the GRI, the <IR> framework, and the PwC
Although the study did not have a benchmark to examine the extent framework, were revealed by some of the responses.
to which the companies had incorporated the goals and targets, it was An official (SM4) explained as follows:
revealed that the SDGs have been integrated into core business prac-
tices by incorporating them into corporate systems, policies, stan- …we always choose to measure inputs, activities, and
dards, and processes. For instance, one of the Manager, SM5 outputs and use them as proxies to estimate outcomes
explained: and impacts in order to know our contribution to the
SDG agenda.
In the beginning, it was difficult to incorporate the
SDGs into our business practices. However, when Several contributions emphasised the use of GRI and <IR> frame-
guidelines on this topic were issued by accountancy work throughout the accountability processes to determine if the
bodies and other relevant agencies, we began by con- anticipated results in measuring and administering performance were
ducting an impact assessment to determine the bene- achieved. A head of marketing (HD3) revealed the following as the
fits and costs of doing a high-level mapping of our approach to measurement systems:
value chain.
We talk to the people who are most affected by our
Respondents also stressed the importance of monitoring and work and try to meet their needs as we develop base-
assessing adverse effects and developing a response plan. Intercon- line measures for the most important indicators. Once
nected SDGs and scattered data sources across departments and pro- they are happy, we know that what we've done meets
cesses in respondents' organisations made accountability for the the SDG target's goal.
SDGs harder to implement. Even though oil company data sources are
fragmented, individuals in authority try their best to integrate SDGs
into business practices. In was also revealed that the public is some- 4.2.3 | Performance reporting and disclosure on the
times mislead into believing that mapping SDGs to business/ SDGs integration
production processes is easy, however that is not the case in fact. The
magnitude of this task was alluded to in the response of SM6: Aligning company practices with the SDGs creates a reporting
expectation (Heras-Saizarbitoria et al., 2022). SDG target 12.6
Our company has aligned environmental goals related encourages governments to encourage business to adopt SDG
to issues like carbon emissions as well as the use of practices and include SDG data in their reporting cycle. Respon-
water and other natural resources. However, aligning dents felt it was vital to make public know how local oil companies
the social aspects of SDGs, such as eradicating poverty contribute to the SDGs for action. It was also suggested that local
and combating corruption, is not common in the real oil companies could emphasise Ghana's SDGs. It was therefore
business processes because these issues are more diffi- hoped that reporting and disclosing contributions will resonate
cult to monitor and assess for success. more with grassroots folks. Reporting and disclosure will help
12 TETTEH ET AL.
CSOs, the government, accountancy agencies, and other key report both the positive and negative aspects of the
stakeholders understand how local oil companies are committing performance outcomes.
to the SDG implementation.
The following interviewee emphasised the importance of commu- Another respondent (SM2) also emphasised that:
nicating SDG performance to customers and the general public. The
official, SM4 said: … we take into account concerns that are extremely
important to the various stakeholders. This involves
We want to share our SDG performance with our cus- addressing the reasonable interests, concerns, and
tomers and community members. They need to see expectations that have been voiced by our stake-
the impactful programmes we have imitated. holders in relation to our company's actions and we
respond to them, even if the SDG in question that
The local oil companies work with global customers who are con- relate to that issue has not been prioritised by the
cerned about certain production and supply-chain norms and stan- company.
dards. As a result, the companies are concerned with communicating
with and disclosing to these critical global customers. The general The local oil companies report and communicate SDG issues such
public is another group of stakeholders mentioned by some inter- as climate change, sustainable water management, employment,
viewees. According to one of the official, SM 6: decent work among others. Therefore, aligning the company's report-
ing with the SDGs requires communicating performance in terms of
Because we are an oil producing company, there are a the SDGs' expectations and ensuring that disclosures use the same
lot of expectations from the general public as well as terminology as the SDGs so that all stakeholders can relate.
other stakeholders, which includes the regulators. They
need to know how we have handled carbon emissions
and preserved the water body and other natural 4.3 | Obstacles preventing IOCs from
resources in the country. implementing and reporting SDG activities
Another respondent, SM1 added that: Companies are making effort to integrate SDGs and report on their
progress but they are confronted with both internal and external hur-
The general public and our shareholders are interested dles, according to the literature (Erin et al., 2022; George et al., 2016).
in finding out more about the social responsibility pro- This section explores the context-specific problems local oil compa-
jects. They are interested in knowing about the contri- nies face when integrating and reporting on SDG implementation.
butions that our company has made to the society. According to the findings, companies face more implementation chal-
This is the reason why we publish reports that include lenges than reporting. The sub themes that emerged from the analysis
SDG performance. are as follows: (i) inadequate financial resources, (ii) Organisational
capabilities (iii) institutional barriers.
It is possible that the prominence of the oil and gas industry is the The research showed that local oil companies lack the financial
reason for the emphasis placed on the public as a stakeholder. As a resources to integrate SDGs into business practices. The depart-
result of this, the public expects oil companies to disclose more infor- ments/units responsible for SDG-related activities in oil companies
mation to maintain their legitimacy and reputation. The study found are usually overwhelmed at the start of the financial year by demands
the kind of materials issues firms prioritise when reporting SDG from other departments/units within the company, as well as institu-
success. Material issues in sustainability reporting show substantial tions and individuals from the surrounding communities and beyond.
economic, environmental, and social impacts of a company could be Interviewees agreed that these requests usually exceed their expecta-
favourable or bad (Erin et al., 2022). They also influence stakeholders' tions and provide obstacles in prioritising SDGs aims. SM7, one of the
judgements and actions. interviewees, stated the following:
One of the officials (SM7) described what oil companies typically
highlight in their sustainability/integrated reports regarding SDG The requests we receive are almost always greater
performance: than our budgetary allocation. Before considering
merry-making projects, we must first consider which
It is likely that the strategic priorities that our company areas, if not aligned with the SDGs, will have a nega-
has identified as a result of the actions we've taken to tive impact on our core operations.
incorporate SDGs into our business practices will be
included on the list of material issues that our company On the issue of inadequate funding, some interviewees stated
reports and discloses. When communicating the per- that although the company has engaged in activities that promote
formance to the priorities that were established, we SDGs, when the information, particularly about social sustainability, is
TETTEH ET AL. 13
disclosed in the entities' sustainable reports, the company ends up Setting new goals that demonstrate SDG adherence is vital for
exposing itself to the public that it is capable of providing these inter- performances of Ghanaian oil companies. All employees must agree
ventions, and institutions and groups end up pressuring the company on new environmental, social, and economic concerns. If a company's
to provide them with similar interventions. For instance, one of the goals coincide with the SDGs, its leaders must commit to sustainable
interviewees (HD6) said that: development.
It was also cited that institutional barriers, such as the complica-
Oh yes, we take pride in disclosing our contributions to tion of regulations and the absence of a legal system that is conducive
the SDGs in the company's sustainability report, but as to the implementation of SDGs in the private sector, are to blame for
we do so for the sake of attracting more business, we the fact that some SDGs being regarded as superior over others in the
also end up receiving more requests to engage in social firm's operational practices and integrated or sustainability reports.
interventions. This exceeds the budgets and that is Regarding this barrier, a heads of finance department (HD7) provided
why we may report on certain SDG programmes and the following:
ignore others.
…there are no stringent regulations in place that force
The oil companies' sustainability reports paid some attention to an institution to incorporate all of the Sustainable
how sustainability affected their day-to-day operations, but they Development Goals. Therefore, the integration is left
devoted a lot of attention to broader concerns such as biodiversity. up to the management's discretion due to the absence
Due to financial constraints, local companies are still hesitant to of a single framework. GRI and IIRC [<IR>] are both
broaden their scope to address all SDG-related concerns affecting involved in the promotion of SDGs; however, their pri-
them. An official, SM 2 explained: mary focus is on reporting and disclosure rather than
the direct incorporation of SDGs into the business
Aligning our business practices with the SDGs takes a strategy of the company.
lot of work and money. We are rational; we don't do
everything at once… We have to take it slow… We are Another respondent, SM3 noted as follows:
very careful because we are a big company. If we make
a mistake, it will have a big effect on us. …Well, the truth is that companies use sustainability
reports to build their reputations and improve their
According to the responses, cost sometimes limits a company's image. We don't have a standard policy as a country or
ability to implement SDG programmes that are unrelated to their core industry about how closely SDGs must be linked to
mandate or business and that is why certain aspects of SDG integra- actual business practices. Because of this, we choose
tion and reporting are taken for granted. the SDGs whose KPIs [Key Performance Indicators]
The organisational structuring system was discovered to be a con- directly address the impact or outcome of our
tributing factor. Goals, routines, organisational structures etc., have an activities.
impact on firms as a social system. Although integrating sustainability
into core business and governance is crucial to accomplishing stated As our planet faces massive economic, social, and environmental
goals therefore, various organisational activities must be reformed to challenges, companies whose activities have the greatest impact on
match with the shift (Jones et al., 2016). It would also be necessary to the planet have attended SDGs that promote the entity's image and
evaluate the effort required to design the business strategy and firm reputation to the neglect of those that do not come with obligations
structure, as well as the need for new organisational competences such or coercive pressures to address.
as team motivation, organisational culture, and participation. Restructur-
ing hinders SDG implementation and reporting due to embedded organi-
sational dynamics. Regarding this barrier, one of the respondents from 5 | DISCUSSION
operations department (HD5) shared the following explanations:
5.1 | Factors influencing the commitment of IOC
We are changing the systems, but it must be done to SDGs
gradually. We had our strategic focus and organisa-
tional settings in place before the SDGs were pro- The findings illustrate a case in which two key external stakeholders,
moted. We are in the seventh year of its enrollment, the government and non-governmental actors such as CSOs and
but we cannot achieve all of the goals in such a short NGOs, exert coercive pressure on companies to be environmentally
period of time, which is why the agenda is set to expire and socially sustainable. According to both the Institutional Theory
in 2030. Some of the SDGs that require massive struc- and Stakeholder Theory, different interest groups exert different
tural change must be sacrificed in order to achieve eco- degrees of pressure on an organisation and have different expecta-
nomic gains too. tions (Scott, 2013; Simoni et al., 2020). Interestingly, institutional
14 TETTEH ET AL.
pressures on local oil companies came from the government. The gov- their operating licence and guaranteeing long-term survival. Erin et al.
ernment wants companies to follow laws and procedures to help (2022) found that SDG practices require senior management endorse-
accomplish SDGs, but it also pressures them to increase oil production ment. Since sustainability concerns are under the responsibility of the
for economic motives. top management, they can guarantee that changes are implemented
Despite pressure from many sources, local oil companies follow to ensure compliance with SDG integration and reporting.
the rules, and those in joint ventures with international companies fol- Compared to normative and mimetic pressures, coercive isomor-
low the directives and practices of their parent company to legitimise phism from those with power, such as regulators and actors on whom
their operations and stay in business. The government is the most oil companies rely for resources, had the greatest impact on the com-
salient stakeholder with power, legitimacy and urgency because it can panies' SDG practises and reporting. From the perspective of Stake-
extend or terminate the operating licence of a company. holder Theory, these coercive pressures emanated from salient
In contrast to the findings of a number of studies (see, stakeholders such as CSOs and NGOs that publicly name and shame
e.g., Heras-Saizarbitoria et al., 2022; Lozano, 2015; Rodrigue businesses for failing to adhere to best SDG practices. The objective
et al., 2013), it was not totally apparent in the case of the oil compa- of such action by non-governmental actors is to harm the reputations
nies that rules and regulations were the key drivers of social and envi- of companies for failure to implement the SDGs. It is also observed
ronmental responsibility among companies. Non-governmental that the CSOs and NGOs appear to have taken over the role of regu-
players, including CSOs and NGOs, rather drive the companies' desire latory authorities in the country in the fight for social and environ-
for change. Historically, organisations viewed CSOs and NGOs as less mental sustainability and accountability in relation to SDG
salient stakeholders (Erin et al., 2022; Heras-Saizarbitoria et al., 2022). implementation and this is due to their power and urgency salience.
This study, like others that were conducted in developing nations
(Deegan & Islam, 2014; Mzembe & Meaton, 2014), indicates the
expanding importance of CSOs and NGOs in promoting sustainability 5.2 | Accountability processes to track the
practices within organisations. commitment of IOCs to the SDGs
The management of the companies perceives the CSOs and
NGOs to have a high degree of coercive influence, legitimacy, and Beyond the institutional pressures to incorporate SDGs into business
power to influence the companies' prestige and reputation, as demon- practices, our analysis of the Ghanaian case adds fresh perspectives
strated by past research (see e.g., Erin et al., 2022; Ismaeel & to the three logical steps of SDG accountability, namely data collec-
Zakaria, 2019). Even though some oil companies are joint ventures, it tion, SDG performance measurement, and communication/reporting
is believed that their foreign partner would be held responsible if a of these results.
local company had an environmental problem. In terms of data collection, the emphasis on centralization and
The importance of CSOs and NGOs is attributed to the fact that standardisation of measurement is justified by the necessity to share
when a corporation engages its non-managerial stakeholders, such as indicators throughout departments and functions to provide accurate
CSOs and NGOs, it increases their corporate visibility due to their fre- aggregation of qualitative evidence for SDG implementation policies.
quent interaction with the general public. Due to the fact that SDG This practice responds to calls for organisations to create sustainable
implementation and reporting increases the transparency and management systems, as environmental and social dimensions are
accountability of a company, stakeholder confidence and corporate often disconnected from financial performance, leaving the contribu-
legitimacy are enhanced (Ceesay, 2020; Deegan & Islam, 2014). The tion made by economic success unclear (Hristov & Chirico, 2019).
oil companies are implementing the concerns raised by these non- It is also evident that some companies have focused on areas that
governmental actors regarding the implementation of the SDG tar- have attracted public attention to establish business cases and satisfy
gets, as these organisations have resorted to ‘naming and shaming’ influential stakeholders. The actions of some of these oil companies
companies for poor social and environmental performance. are not surprising, given that existing research shows that there is no
In addition, a number of internal factors influenced the SDG prac- limit to selecting SDG targets and KPIs beyond those that appear rele-
tices and reporting oil companies. The study reveals that the protec- vant. The option depends on each company's characteristics. Each
tion of the companies and the reputation of the joint venture partners company selects SDG targets that summarise its situation and per-
is the greatest internal pressure felt by local oil companies. This was spective to attain this goal. Previous studies (see, ElAlfy et al., 2020;
exacerbated by the legitimacy crisis encountered by international oil Hristov & Chirico, 2019) have discovered that organisations prioritise
companies, which affected the entire industry. In order to safeguard environmentally friendly business practices, which result in increased
their reputations, local companies also participated in socially and sales as a direct result of increased brand value and image building.
environmentally responsible activities. As a result of audit pressures The study further found that local companies employed GRI, <IR>,
from their international partners, many joint venture companies were and PwC frameworks to measure performance and communicate
compelled to include SDGs into their business practices. SDG results. This result responds to the demand for business entities
These companies were audited to ensure their activities fit with to adopt frameworks that will assist in measuring and communicating
the SDGs by following their international partners' recommendations. SDG outcomes to stakeholders (Abhayawansa et al., 2021;
Top management considered sustainability as important to preserving Hayakawa, 2017).
TETTEH ET AL. 15
In the quest to communicate SDG performance, the responses of initiatives that assist in preventing harm, as opposed to those that are
the interviewees shed light on two major institutional logics: disclo- designed to do good.
sure and transparency logic and reputation and image building logic. The lack of adequate organisational capacity to account for
The former is exemplified by the emphasis of the interviewees on SDG implementation and reporting has also been recognised as a
stakeholder engagement and the disclosure role of sustainability challenge. It could be challenging for businesses to entirely synchro-
reports, whereas the latter is exemplified by the emphasis of inter- nise their existing processes with SDG implementation. Another dif-
viewees on their companies' status as role models and the public rela- ficulty that arose was the absence of a standardised reporting and
tions role of sustainability reports. integration framework for SDGs. The results of this study offer a
The consensus on the disclosure role of SDG integration, for critical analysis of the theoretical role discussed in the literature
instance, and the emphasis on transparency as a rationale to commu- review. It is acceptable for organisations to share useful information
nicate SDG performance are consistent with the sustainability and about their SDG activities because they are bounded by social con-
business accountability discourses being promoted by international tracts within their environment. The findings of this study reveal
and NGOs (Ismaeel & Zakaria, 2019). However, mostly the SDGs were that it will be nearly impossible to implement the SDGs effectively
only minimally or not at all implemented by the businesses. With the for national development without the help of corporate organisa-
notable exception of a very small number of company representatives tions. This is in line with a study by Erin and Asiriuwa (2019), which
who could link specific strategies, goals, targets, indicators, actions, or found that corporate organisations are crucial to making the SDGs a
results, the majority of the representatives exhibited an incredibly reality. The inclusion of SDGs in organisational practices is expected
superficial approach to SDG integration and reporting. In most of the to be driven by institutions with sufficient financial resources and
interviews, it appears SDGs are only used to freshen up company scalable organisational structures. These institutions are also
reports with colourful visuals and fancy icons, a practise known as expected to report on their performance, whether it is positive
‘SDG icon-picking’ that may be indicative of impression management or negative, in their corporate annual reports (Van der Vaal &
and SDG-washing (Heras-Saizarbitoria et al., 2022). The fact that the Thijssens, 2020).
SDGs are so broad, as noted by Siegel and Lima (2020), has given Linking the discussion of the findings to the theoretical frame-
ample room for cherry-picking and given rise to a form of sustainabil- work, it was clear that external and internal factors influenced the
ity metonymy, wherein meeting selected targets of choice commitment of IOCs to SDGs implementation, reporting, and disclo-
(e.g., economic growth, eliminating global hunger) are taken to signify sure. The external forces originated from coercive, normative, and
compliance with the whole of the 2030 Agenda, regardless of other memetic mechanisms emanate from regulatory institutions, profes-
goals and targets disregarded in the process. sional organisations, the government, CSOs, and NGOs. Similarly,
Additionally, the logic of cherry-picking is to build company repu- internal forces such as top management support, skilled personnel,
tation and image which is consistent with the business case discourse, and oversights from the parents of joint venture companies, among
which is part of the conventional business concept widely adopted by others, impacted the implementation, reporting, and disclosure of the
corporate executives (García-Meca & Ferrero, 2021). The current find- SDGs. Also, it emerged that legitimising frameworks, such as GRI,
ings on reputation and image building through SDG performance com- <IR>, and PwC, shape the IOCs practices to address any credibility
munication to stakeholders are consistent with the existing literature gaps to avoid sanctions from influential stakeholders.
(Erin et al., 2022; Heras-Saizarbitoria et al., 2022). Similarly, the litera-
ture reveals that companies in environmentally sensitive industries
may be more involved in SDG targets that ‘avoid harm’ rather than in 6 | CONCLUSION, CONTRIBUTION AND
those that ‘do good’. Hence, the use of the Sustainability/SDG SUGGESTION FOR FUTURE STUDIES
reports by the companies as a scheme with quasi-implications, facili-
tates impression management. 6.1 | Conclusion
The paper used Institutional Theory and Stakeholder Theory to inves-
5.3 | Obstacles preventing IOCs from tigate and explain how and why IOCs interact with their internal and
implementing and reporting SDG activities external environments, as well as how their strategic responses influ-
ence SDG implementation and reporting. The paper focused on three
Accounts of SDG practices and reporting by respondents show that goals: the factors that primarily influence the IOCs' commitment to
the companies face varying degrees of difficulty in responding to SDG and how the companies respond to such pressures; the account-
stakeholder pressure to integrate and report on SDGs. For instance, ability processes used to track the IOCs progress on contributing to
while reporting on SDG activities is not a statutory obligation for the SDGs; and the obstacles that prevent IOCs from implementing
organisations, majority of businesses believe there is no need to and reporting SDG activities.
extend their budgets to satisfy those standards, and this result in the The findings lead to three broad conclusions. First, pressures are
decision to disregard specific SDG practices and reporting. This chal- increasing on IOCs to ensure accountable implementation and report-
lenge emphasises the need of firms investing more money in ing of SDG practices for sustainable development. In pursuit of the
16 TETTEH ET AL.
SDG agenda, the IOCs appear to be sensitive to both internal and 6.2 | Contribution and suggestion for future
external stakeholder pressure. Senior management, foreign partner studies
audit processes, and the desire to safeguard a company's reputation
were found to also constitute internal pressure on the companies to The paper makes a key contribution to the accounting literature by
realise the SDGs, even though the government and non-governmental extending the motivation for corporate SDG practices (see
entities also continue to impose external pressure on them. The study e.g., Abdalla & Siti Nabiha, 2015; Erin et al., 2022; Gerged &
also reveals that competing stakeholder pressures, as well as differ- Almontaser, 2021; Heras-Saizarbitoria et al., 2022; Ite, 2018), to
ences in stakeholder power, resulted in differences in the companies' unravel how non-governmental actors such as CSOs and NGOs have
responses to SDG implementation and reporting. Hence, the study taken on the role of ‘regulator’ of organisational practices in the con-
concludes that CSOs and NGOs are a subgroup of stakeholders with text of a developing country with weak regulatory oversight and
the most influence and are better positioned than other stakeholder enforcement. These findings, in particular, highlight the significant role
groups to exert pressure on oil companies to commit to SDG imple- played by CSOs and NGOs in shaping SDG practices and disclosure in
mentation in Ghana. One plausible conclusion is that non- the extractive industry. This study also contributes to organisational
governmental actors have taken on the role of ‘regulator’ of studies by elucidating companies' engagement with the SDGs as a
organisational practices in the context of a developing country with means of enhancing their social legitimacy and linking current activity
weak regulatory oversight and enforcement. to the SDGs as a means of impression management (van der Waal &
The findings confirm previous evidence that both theoretical Thijssens, 2020), two strategies that might be associated with SDG-
frameworks are effective in explaining the decisions of firms to washing in the extant literature (van der Waal & Thijssens, 2020).
implement sustainable development practices (Braam & This research has some practical implications. It shows that local
Peeters, 2018; Herold, 2018; Simoni et al., 2020). As noted by oil companies must restructure their business processes to achieve
García-Meca and Ferrero (2021), Erin et al. (2022), and Lu et al. the SDGs. Local oil companies must, therefore, reorganise their inter-
(2021), research on SDGs practices by corporate organisations is in nal management accounting and control to integrate and report SDGs
its infancy in the accounting literature, and additional evidence is efficiently. This is necessary because local oil companies found it chal-
required. Moreover, the findings expand on previous evidence lenging to synchronise their existing operations with the SDGs. For a
regarding the factors that influence corporate organisations to pro- company to gain legitimacy, its SDG agenda must incorporate non-
mote SDGs in developing nations. governmental stakeholders' concerns into corporate decision-making.
Also, beyond the institutional pressures to incorporate SDGs into Finally, the findings provide a sound framework for designing pol-
business practices, our analysis of the Ghanaian case adds fresh per- icies and mechanisms to increase company integration of SDG targets
spectives to the three logical steps of SDG accountability used by the into their strategic focus and disclosure of SDG actions in annual or
local oil companies to track their contribution to SDG implementation sustainability reports in emerging economies. The SDG integration
and reporting, namely: data collection, SDG performance measure- and disclosure practices should be better regulated, and this should
ment, and communication/reporting of these results. More precisely, include terms of the reliability of information and the implementation
the study concludes that two major institutional logics shape the of verification mechanisms carried out by qualified auditors, given the
quest to implements and communicate SDG performance to stake- critical importance of the issues covered by the SDGs and their public
holders: disclosure and transparency logic and reputation and image interest. The verification of SDG disclosures by government-
building logic. Although global institutional influences for companies appointed experts and external stakeholders, such as government
to comply with the use of KPIs from GRI, <IR>, PwC framework representatives and NGOs, would likely increase the credibility of
among others shape their SDG implementation and reporting. In view companies' actual practices and sustainability/SDG reports.
of this, a plausible conclusion is that firms' internal institutional envi- One limitation of the study is that the data analysed are the expe-
ronment also influences the alignment of company interests and prior- riences of individuals who were called to give oral testimony about
ities to the implementation and reporting of SDG targets. As a result, the issue under investigation, although their responses were triangu-
the practice has been a hybrid which include both meeting SDG tar- lated with written archival documents on the companies' websites,
gets that help companies avoid harm and those that build the image environmental impact assessment reports, and other sources. More
or reputation necessary for a business case. research could examine the institutional pressures on the IOCs to
Regarding the third objective, the results indicate that the IOCs adopt SDG practices and the accountability and governance systems
are making little progress towards the achievement of the SDGs used to track their progress in contributing to the 2030 agenda in,
because of financial limitations, rigid organisational environments that say, 4 years. The research could examine how close they were to what
prevent change, and a lack of a standardised institutional framework. respondents believed was required and how much that helped or hin-
Again, voluntary disclosure of SDG activities encourages companies dered value creation for stakeholders, that is, society and the econ-
to pursue SDG initiatives that ‘avoid harm’ rather than ‘do good’. omy. Future research could also investigate whether the influence of
Thus, these companies use SDGs implementation as a strategy to pro- CSOs and NGOs results in actual or symbolic change in organisational
mote reputation management (Van der Waal & Thijssens, 2020) and practices. Again, future research could look into the interaction
SDG reporting a camouflage tool. between the norms of international oil companies and the values of
TETTEH ET AL. 17
their Ghanaian partners in pushing for sustainability practices, that is, Braam, G., & Peeters, R. (2018). Corporate sustainability performance and
the process of imported normative isomorphism. assurance on sustainability reports: Diffusion of accounting practices
in the realm of sustainable development. Corporate Social Responsibility
and Environmental Management, 25(2), 164–181.
ORCID Braun, V., Clarke, V., Boulton, E., Davey, L., & McEvoy, C. (2021). The
Lexis Alexander Tetteh https://orcid.org/0000-0001-5087-9701 online survey as a qualitative research tool. International Journal of
Social Research Methodology, 24(6), 641–654.
Braun, V., & Clarke, V. (2006). Using thematic analysis in psychology. Qual-
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