Abstract
This paper looks at the topic of regulation of integrated reporting for listed companies, with the aim of contributing to the debate on the usefulness of introducing a mandatory regime, both from the perspective of integrated performance sustainability of companies and from that of relevance of information for providers of financial capital. The study is based on empirical research carried out on a sample composed of companies operating in territories where the adoption of integrated reporting is voluntary (Europe) and those operating in a country where adoption is mandatory (South Africa). The research shows that (a) in voluntary regimes, levels of integrated performance achieved by companies are higher; (b) mandatory regulation produces positive effects on integrated performance levels in the medium term; (c) integrated performance indicators are value-relevant, though having different levels of relevance under the two regimes examined.
Highlights
The adoption of an integrated reporting approach, overcoming the boundaries and limitations of traditional information systems, is expected to enhance the effectiveness of internal control systems and to support the achievement of financial, environmental and social results; in other words, the sustainability of the overall performance, boosting the value creation of the organization [1]
We have examined the topic of the regulation of integrated reporting for listed companies, from an economic-corporate viewpoint, with the intention of contributing to the debate on the usefulness of introducing a mandatory regime, both from the viewpoint of integrated corporate performance sustainability and that of relevance of information for providers of financial capital
As we clarified in the paper, this result was to be expected, even though we decided to provide empirical evidence, because the companies selected in the voluntary regime area (EU) represent a “select” part of the whole population; that is, a group of companies that probably use integrated reporting practices because they have “something extra” to show compared with other companies in the same area that do not adopt these practices
Summary
The adoption of an integrated reporting approach, overcoming the boundaries and limitations of traditional information systems, is expected to enhance the effectiveness of internal control systems and to support the achievement of financial, environmental and social results; in other words, the sustainability of the overall performance, boosting the value creation of the organization [1]. Such an approach is expected to improve the value relevance of traditional accounting information [2,3,4]. Ioannou and Serafeim [12] verified that sustainability disclosure regulations positively affect company valuation
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
