Mind the Gaps! Legitimacy and Expectation Misalignments in Sustainability Disclosure: Case Evidence From a Public Forestry Sector Organization

Vollständiger Abstract

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ABSTRACT Sustainability disclosure by public sector organizations remains under‐examined, particularly in the forestry and natural resources sector, where organizations combine strong public accountability obligations with operations in environmentally sensitive ecosystems. In these settings, legitimacy rests on the alignment between what an organization discloses, what its stakeholders perceive, and what they expect; the misalignments between them are what legitimacy and stakeholder theory seek to explain. Because these theories have so far been applied mainly to private firms, little is known about how such gaps manifest in the public sector. The present paper addresses this research gap through three research questions: whether a public forestry organization emphasizes particular sustainability dimensions in its disclosure; whether stakeholders' perceptions of current disclosure and performance diverge from the organization's own, forming an expectational gap; and whether stakeholders' expectations exceed their perceptions, forming a legitimacy gap. Using a mixed‐methods case study of a Greek public forestry organization, combining organizational interviews and disclosure analysis with a stakeholder survey, this research finds a legitimacy gap and a factual expectational gap, while the hypothesis that environmental sustainability is prioritized is not supported. The research contributes by extending legitimacy and stakeholder theory to the public forestry context and by introducing the self‐fulfilling prophecy as a mechanism through which stakeholder beliefs reinforce and widen legitimacy gaps.