Beyond Financial Reporting. Integrated Reporting and its determinants: Evidence from the context of European state-owned enterprises

Journal title FINANCIAL REPORTING
Author/s Giuseppe Nicolò, Gianluca Zanellato, Francesca Manes-Rossi, Adriana Tiron-Tudor
Publishing Year 2019 Issue 2019/2
Language English Pages 30 P. 43-72 File size 191 KB
DOI 10.3280/FR2019-002003
DOI is like a bar code for intellectual property: to have more infomation click here

Below, you can see the article first page

If you want to buy this article in PDF format, you can do it, following the instructions to buy download credits

Article preview

FrancoAngeli is member of Publishers International Linking Association, Inc (PILA), a not-for-profit association which run the CrossRef service enabling links to and from online scholarly content.

Integrated reporting (IR), which aims to overcome the limitations of both tradi-tional financial and stand-alone non-financial reports, has gained momentum as a single comprehensive tool merging financial and non-financial information. Initially conceived for private sector entities, IR is also establishing itself in the public sector context as a vehicle for transparency and accountability. This research offers an empirical investigation of IR practices in the State-Owned Enterprises (SOEs) context. More specifically, the paper investigates the levels of disclosure provided through IR by a sample of 34 European SOEs and explores the effects of potential explanatory factors. The results indicate a fair level of IR disclosure and a trend of reporting information already requested under international accounting standards. The findings also highlight that industry (basic materials and financials) and size positively influence the level of IR disclosure in a particularly strong way, while governance features (board size and board gender diversity) and the provision of external assurance do not exert any impact.

Keywords: Integrated reporting, state-owned enterprises, non-financial disclosure, accountability

  1. Adams S. and Simnett R. (2011), Integrated Reporting: An opportunity for Australia’s not‐for‐profit sector, Australian Accounting Review, 21(3), pp. 292-301,
  2. Adhikariparajul M., Hassan A., Fletcher M. and Elamer A.A. (2019), Integrated Reporting in UK Higher Education Institutions, Sustainability Accounting, Management and Policy Journal, (Accepted 14th January 2019), Forthcoming.
  3. Albertini E. (2018), Integrated reporting: an exploratory study of French companies, Journal of Management and Governance, pp. 1-23,
  4. Alfiero S., Cane M., Doronzo R. and Esposito A. (2018). Determining characteristics of boards adopting Integrated Reporting. Financial Reporting, 2, pp. 37-71, DOI: 10.3280/FR2018-002003
  5. Allini A., Manes-Rossi F. and Hussainey K. (2016), The board’s role in risk disclosure: an exploratory study of Italian listed state-owned enterprises, Public Money & Management, 36(2), pp. 113-120, DOI: 10.1080/09540962.2016.1118935
  6. Ball A. and Grubnic S. (2007), Sustainability accounting and accountability in the public sector in J. Unerman, J. Bebbington and B. O’Dwyer (eds.), Sustainability Accounting and Accountability, pp. 243-265 (Oxon and New York: Routledge).
  7. Bartocci L. and Picciaia F. (2013), Towards integrated reporting in the public sector, in Integrated Reporting, pp. 191-204 (Cham.: Springer).
  8. Biondi L. and Bracci E. (2018), Sustainability, Popular and Integrated Reporting in the Public Sector: A Fad and Fashion Perspective, Sustainability, 10(9), pp. 1-16,
  9. Brusca I., Labrador M. and Larran M. (2018), The challenge of sustainability and integrated reporting at universities: A case study, Journal of Cleaner Production, 188, pp. 347-354,
  10. Bruton G.D., Peng M.W., Ahlstrom D., Stan C. and Xu K. (2015), State-owned enterprises around the world as hybrid organizations, Academy of Management Perspectives, 29(1), pp. 92-114,
  11. Calabrò A., Torchia M. and Ranalli F. (2013). Ownership and control in local public utilities: the Italian case, Journal of Management & Governance, 17(4), pp. 835-862,
  12. Chan M. C., Watson J. and Woodliff D. (2014), Corporate governance quality and CSR disclosures, Journal of Business Ethics, 125(1), pp. 59-73,
  13. Cormier D. and Gordon I.A. (2001), An examination of social and environmental reporting strategies, Accounting, Auditing and Accountability Journal, 14(5), pp. 587-617, DOI: 10.1108/EUM0000000006264
  14. Deegan C. (2006), Financial accounting theory (North Ryde: McGraw-Hill).
  15. Del Bello A. (2006), Intangibles and sustainability in local government reports: an analysis into an uneasy relationship, Journal of Intellectual Capital, 7(4), pp. 440-456, DOI: 10.1108/14691930610709103
  16. Dumay J., Guthrie J. and Farneti F. (2010), GRI sustainability reporting: guidelines for public and third sector organizations, Public Management Review, 12(4), pp. 531-548, DOI: 10.1080/14719037.2010.496266
  17. Eccles R. G. and Krzus M. P. (2010), One report: Integrated reporting for a sustainable strategy (Hoboken, NJ: John Wiley & Sons).
  18. Eccles R.G. and Saltzman D. (2011). Achieving sustainability through integrated reporting, Stanf Soc Innov Rev, Summer, 59.
  19. Ellwood S. and Garcia-Lacalle J. (2015), The influence of presence and position of women on the boards of directors: The case of NHS foundation trusts, Journal of Business Ethics, 130(1), pp. 69-84,
  20. EU Commission. Directive 2014/95/EU of the European Parliament and the Council of 22 October 2014 amending Directive 2013/34/EU as Regards Disclosure of Non-Financial and Diversity Information by Certain large Undertakings and Groups; EU Commission: Brussels, Belgium, 2014; pp. 1-9.
  21. Farneti F. and Guthrie J. (2009), Sustainability reporting by Australian public sector organisations: Why they report, Accounting Forum, 33(2), pp. 89-98,
  22. Farneti F. and Siboni B. (2011), An analysis of the Italian governmental guidelines and of the local governments’ practices for social reports, Sustainability Accounting, Management and Policy Journal, 2(1), pp. 101-125.
  23. Frias‐Aceituno J.V., Rodriguez‐Ariza L. and Garcia‐Sanchez I.M. (2013), The role of the board in the dissemination of integrated corporate social reporting, Corporate social responsibility and environmental management, 20(4), pp. 219-233,
  24. García-Sánchez I.M., Rodríguez-Ariza L. and Frías-Aceituno J.V. (2013), The cultural system and integrated reporting, International Business Review, 22(5), pp. 828-838.
  25. Giacomini D., Rocca L., Carini C. and Mazzoleni M. (2018), Overcoming the Barriers to the Diffusion of Sustainability Reporting in Italian LGOs: Better Stick or Carrot?. Sustainability, 10(1), pp. 1-14,
  26. Girella L., Rossi P. and Zambon S. (2019), Exploring the firm and country determinants of the voluntary adoption of integrated reporting, Business Strategy and the Environment, 28(7), November,
  27. Greiling D., Traxler A.A. and Stötzer S. (2015), Sustainability reporting in the Austrian, German and Swiss public sector, International Journal of Public Sector Management, 28(4/5), pp. 404-428, DOI: 10.1108/IJPSM-04-2015-0064.
  28. Grossi G., Papenfuß U. and Tremblay M.S. (2015), Corporate governance and accountability of state-owned enterprises: relevance for science and society and interdisciplinary research perspectives, International Journal of Public Sector Management, 28(4/5), pp. 274-285.
  29. Guthrie J., Manes-Rossi F. and Orelli R.L. (2017), Integrated reporting and integrated thinking in Italian public sector organisations, Meditari Accountancy Research, 25(4), pp. 553-573, DOI: 10.1108/MEDAR-06-2017-0155
  30. Holder-Webb L., Cohen J.R., Nath L. and Wood D. (2009), The supply of corporate social responsibility disclosures among US firms, Journal of Business Ethics, 84(4), pp. 497-527,
  31. IASB (2010), Management commentary, practice statement. London: International Accounting Standards Board.
  32. IIRC (2013), The International <IR> Framework, -- available at http://www.theiirc.org.
  33. Incollingo A. and Bianchi M. (2016), The connectivity of information in integrated reporting. Empirical evidence from international context, Financial Reporting, 2, pp. 55-78, DOI: 10.3280/FR2016-002003
  34. International Integrated Reporting Council (IIRC) (2016), Integrated Thinking and Reporting: Focusing on Value Creation in the Public Sector an Introduction for Leaders (London: IIRC).
  35. Jensen M.C. and Meckling W.H. (1976), Theory of the firm: Managerial behavior, agency costs and ownership structure, Journal of financial economics, 3(4), pp. 305-360, DOI: 10.1016/0304-405X(76)90026-X
  36. Katsikas E., Manes-Rossi F. and Orelli R. (2017). Towards Integrated Reporting - Accounting Change in the Public Sector (Switzerland: Springer).
  37. Kılıç M. and Kuzey C. (2018)(a), Determinants of forward-looking disclosures in integrated reporting, Managerial Auditing Journal, 33(1), pp. 115-144, DOI: 10.1108/MAJ-12-2016-1498
  38. Kılıç M. and Kuzey C. (2018)(b), Assessing current company reports according to the IIRC integrated reporting framework, Meditari Accountancy Research, 26(2), pp. 305-333, DOI: 10.1108/MEDAR-04-2017-0138
  39. King Code of Governance for South Africa 2009, Institute of Directors South Africa, 2009.
  40. Krippendorff K. (1980), Content analysis: An introduction to its methodology (Beverly Hills, CA: The Sage CommText Series, Sage).
  41. La Torre M., Sabelfeld S., Blomkvist M.,Tarquinio L. and Dumay J. (2018), Harmonising non-financial reporting regulation in Europe: Practical forces and projections for future research, Meditari Accountancy Research, 26(4), pp. 598-621, DOI: 10.1108/MEDAR-02-2018-0290
  42. Lai A., Melloni G. and Stacchezzini R. (2016), Corporate sustainable development: is ‘integrated reporting’a legitimation strategy?, Business Strategy and the Environment, 25(3), pp. 165-177,
  43. Lev B. (2018), The deteriorating usefulness of financial report information and how to reverse it, Accounting and Business Research, 48(5), pp. 465-493, DOI: 10.1080/00014788.2018.1470138
  44. Lindblom C.K. (1994), The implications of organizational legitimacy for corporate social performance and disclosure, paper presented at the Critical Perspectives on Accounting Conference, New York.
  45. Manes-Rossi F. (2018), Is integrated reporting a new challenge for public sector entities?, African Journal of Business Management, 12(7), pp. 172-187, DOI: 10.5897/AJBM2018.8498.
  46. Melloni G., Caglio A. and Perego P. (2017), Saying more with less? Disclosure conciseness, completeness and balance in Integrated Reports, Journal of Accounting and Public Policy, 36(3), pp. 220-238,
  47. Milne M.J. and Gray R. (2013), W(h)ither ecology? The triple bottom line, the global reporting initiative, and corporate sustainability reporting, Journal of Business Ethics, 118(1), pp. 13-29,
  48. Montecalvo M., Farneti F. and de Villiers C. (2018), The potential of integrated reporting to enhance sustainability reporting in the public sector, Public Money & Management, 38(5), pp. 365-374, DOI: 10.1080/09540962.2018.1477675
  49. OECD (2015), OECD, Recommendation of the Council on Guidelines on Corporate Governance of State-Owned Enterprises, OECD/LEGAL/0414.
  50. Pistoni A., Songini L. and Bavagnoli F. (2018), Integrated Reporting Quality: An Empirical Analysis. Corporate Social Responsibility and Environmental Management. Published online in Wiley Online Library (wileyonlinelibrary.com)
  51. Pistoni A. and Songini L. (2013), Corporate social responsibility determinants: The relation with CSR Disclosure. In Accounting and control for sustainability, pp. 3-32 (Bingley: Emerald Group Publishing).
  52. Rivera-Arrubla Y.A., Zorio-Grima A. and García-Benau M.A. (2017), Integrated reports: disclosure level and explanatory factors, Social Responsibility Journal, 13(1), pp. 155-176, DOI: 10.1108/SRJ-02-2016-0033
  53. Robertson F.A. and Samy M. (2015), Factors affecting the diffusion of integrated reporting – a UK FTSE 100 perspective, Sustainability Accounting, Management and Policy Journal, 6(2), pp. 190-223, DOI: 10.1108/SAMPJ-07-2014-0044
  54. Sofian I. and Dumitru M. (2017), The Compliance of the Integrated Reports Issued by European Financial Companies with the International Integrated Reporting Framework, Sustainability, 9(8), pp. 1-16,
  55. Suchman M.C. (1995), Managing legitimacy: Strategic and institutional approaches, Academy of Management Review, 20(3), pp. 571-610,
  56. Wild S. and van Staden C. (2013, July), Integrated reporting: initial analysis of early reporters – an institutional theory approach. In Seventh Asia Pacific Interdisciplinary Research in Accounting Conference (Vol. 1).
  57. Zhou S., Simnett R. and Green W. (2017), Does integrated reporting matter to the capital market?, Abacus, 53(1), pp. 94-132,

  • MODELING THE RELATIONSHIP BETWEEN INTEGRATED REPORTING QUALITY AND SUSTAINABLE BUSINESS DEVELOPMENT Marius-Sorin Ciubotariu, Marian Socoliuc, Veronica Grosu, Svetlana Mihaila, Cristina Gabriela Cosmulese Cosmulese, in Journal of Business Economics and Management /2021 pp.1476
    DOI: 10.3846/jbem.2021.15601
  • What drives the innovation in corporate social responsibility (CSR) disclosures? An integrated reporting perspective from China Yanqi Sun, Cheng Xu, Haoyang Li, Yuanyuan Cao, in Journal of Innovation & Knowledge 100267/2022 pp.100267
    DOI: 10.1016/j.jik.2022.100267
  • Integrating ESG issue into performance management system: An analysis of Italian Context Salvatore Principale, Daniela Cicchini, Luigi Andrea Carello, Rubina Michela Galeotti, in MANAGEMENT CONTROL 2/2024 pp.15
    DOI: 10.3280/MACO2024-002002
  • Integrating SEM, Wald test and ANOM to disentangle the effect of TMT functional background on strategic plans Fabrizia Sarto, Sara Saggese, Emmadonata Carbone, Pasquale Sarnacchiaro, in Socio-Economic Planning Sciences 102083/2024 pp.102083
    DOI: 10.1016/j.seps.2024.102083
  • La relazione tra l'esperienza degli amministratori e il business plan: un'indagine empirica sulle imprese quotate in Italia Emmadonata Carbone, Sara Saggese, Fabrizia Sarto, in MANAGEMENT CONTROL 1/2023 pp.69
    DOI: 10.3280/MACO2023-001004
  • Does effective and sustainable corporate governance mechanisms affect the relevance of non‐financial information? Annamaria Zampella, Francesco Campanella, Luana Serino, Alessia Spignese, in Corporate Social Responsibility and Environmental Management csr.2989/2024
    DOI: 10.1002/csr.2989

Giuseppe Nicolò, Gianluca Zanellato, Francesca Manes-Rossi, Adriana Tiron-Tudor, Beyond Financial Reporting. Integrated Reporting and its determinants: Evidence from the context of European state-owned enterprises in "FINANCIAL REPORTING" 2/2019, pp 43-72, DOI: 10.3280/FR2019-002003