Indonesian Journal of Sustainability Accounting and Management ISSN 2597–6214 | e–ISSN 2597–6222 http://unpas.id/index.php/ijsam DOI: 10.32456/ijsam.v5i2.404 Copyright © 2021 by the author(s). This article is published under the Creative Commons Attribution (CC BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial & non-commercial purposes), subject to full attribution to the original publication and author(s). The full terms of this license may be seen at http://creativecommons.org/licenses/by/4.0/legalcode Sustainability Reporting on Financial Performance of Sri Lankan Listed Companies: How Strong is the Impact? Ranitha Sachinthana Weerarathna 1 * | Anuja Akalanka Lokeshwara 2 | Weerarathna Arachchi Patabendige Limalka Sandali 3 | Gunathilake Walallawita Kankanamge Nisal Chandula 4 | Marasinghe Arachchige Chathushka Nirman 5 1 SLIIT Business School, Sri Lanka Institute of Information Technology, Malabe, Sri Lanka 2 SLIIT Business School, Sri Lanka Institute of Information Technology, Malabe, Sri Lanka 3 SLIIT Business School, Sri Lanka Institute of Information Technology, Malabe, Sri Lanka 4 SLIIT Business School, Sri Lanka Institute of Information Technology, Malabe, Sri Lanka 5 SLIIT Business School, Sri Lanka Institute of Information Technology, Malabe, Sri Lanka *Correspondence to: Ranitha Sachinthana Weerarathna, SLIIT Business School, Sri Lanka Institute of Information Technology, Malabe, Sri Lanka. E-mail: ranitha.w@sliit.lk Abstract: This study seeks to examine and identify the impact of sustainability reporting (SR) on the financial performance (FP) of listed companies in Sri Lanka. Data were collected from annual reports of listed companies where sustainability is disclosed in line with the Global Reporting Initiative (GRI) framework. A quantitative approach was used to gather relevant data of the entire population of 289 companies listed on the Colombo Stock Exchange, representing 20 different market sectors. Following purposive sampling, 55 listed companies were ultimately considered, based on the report preparation of those companies having been in line with the GRI framework from 2015/16 to 2018/19. SR was gathered through content analysis based on G4 and GRI standards and measured using an SR index. The authors measured FP using return on assets (ROA). After collecting the data, the authors analyzed it with panel data regression. Findings revealed an insignificant negative impact of SR on the FP of the listed companies in Sri Lanka. Further, researchers identified the impact of each disclosure of SR on FP and identified mixed results. Keywords: economic disclosure, environmental disclosure, financial performance, social disclosure, sustainability reporting. Article info: Received 8 November 2020 | revised 22 April 2021 | accepted 4 June 2021 Recommended citation: Weerarathna, R. S., Lokeshwara, A. A., Sandali, W. A. P. L., Chandula, G. W. K. N., & Nirman, M. A. C. (2021). Sustainability Reporting on Financial Performance of Sri Lankan Listed Companies: How Strong is the Impact? Indonesian Journal of Sustainability Accounting and Management, 5(1), 162–174. https://doi.org/10.32456/ijsam.v5i2.404. INTRODUCTION In the contemporary corporate world, sustainability reporting (SR) is an essential subject matter and is considered one of the crucial challenges globally (Mudiyanselage, 2018). SR can be referred to as a voluntary endeavor that involves publishing accounts that reflect an organization’s economic, environment, and social performance (Kumar et al., 2018). Inevitably, the actions of companies create a direct or indirect impact on the aspects of profits, planet, and people (Anbarasan & Sushil, 2018). Thus, companies need to exemplify that their