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1 – 10 of over 8000Sumit Lodhia, Umesh Sharma and Mary Low
This paper aims to introduce the special issue on “sustainability and accounting for non-financial matters: qualitative and quantitative research approaches”. This special issue…
Abstract
Purpose
This paper aims to introduce the special issue on “sustainability and accounting for non-financial matters: qualitative and quantitative research approaches”. This special issue was organised at the time when the entire globe was affected by the Coronavirus and accordingly, this paper has taken this opportunity to discuss the implications of this pandemic on accounting for non-financial issues, especially in relation to sustainability accounting research and practice.
Design/methodology/approach
An analysis of public documents and limited academic research on the Coronavirus was undertaken in this paper to highlight how life as it existed has fundamentally changed. The authors also review the papers published in this special issue and identifies research opportunities arising from the current environment.
Findings
The onslaught of the Coronavirus provides both challenges and opportunities for the practice of, and research into, accounting for non-financial matters, such as sustainability. The papers published in this special issue promote understanding and linking of sustainability reporting practices, to creating firm values, as well as identifying current and emerging challenges. The special issue explores criteria for the construction of accounting technology that is consistent with agnostic-based critical accounting and accountability, a business case for managers and practitioners to formulate strategic and management control systems in response to climate change issues, legitimacy and the use of photographs in sustainability reporting to create value, effective disclosures of business and sustainability ethics practiced by the firm for reputation building and value creation, indigenous accounting in mining companies, public sector policy framing of non-financial value, the barriers to sustainability reporting because of lack of awareness and knowledge and inadequate regulatory support in developing countries and the significance of sustainability accounting education to improve sustainability reporting practices in developing countries.
Research limitations/implications
Future research opportunities in relation to the impact of the Coronavirus on accounting for non-financial value are identified. Given that COVID-19 is a societal matter, the practical implications of the Coronavirus in accounting for non-financial value creation are highlighted. The Coronavirus has challenged the existing economic paradigm and non-financial issues will capture the attention of corporations, other institutions, civil society and governments.
Practical implications
The Coronavirus has challenged the existing economic paradigm and non-financial issues will capture the attention of corporations, other institutions, civil society and governments.
Social implications
Given that COVID-19 is a societal matter, the practical implications of the Coronavirus in accounting for non-financial value creation are highlighted.
Originality/value
This study, to the knowledge, is one of the pioneer academic studies that has explored the implications of the Coronavirus on accounting for non-financial value. In addition, this special issue includes papers that highlight how non-financial reporting matters are increasingly being given attention by companies to enhance business practices on sustainability through different perspectives.
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The purpose of this paper is to present an expanded introduction of Jasanoff’s (2003, 2007) work on “technologies of humility” to the accounting literature and to show how it can…
Abstract
Purpose
The purpose of this paper is to present an expanded introduction of Jasanoff’s (2003, 2007) work on “technologies of humility” to the accounting literature and to show how it can be useful in developing critical dialogic accountings for non-financial matters.
Design/methodology/approach
Drawing on Jasanoff’s (2003, 2007) distinction between “technologies of hubris” and “technologies of humility”, this study extends prior research on critical dialogic accounting and accountability (CDAA) that seeks to “take pluralism seriously” (Brown, 2009; Dillard and Vinnari, 2019). This study shows how Jasanoff’s work facilitates constructing critical, reflexive approaches to accounting for non-financial matters consistent with agonistics-based CDAA.
Findings
Jasanoff’s four proposed focal points for developing new analytical tools for accounting for non-financial matters and promoting participatory governance – framing, vulnerability, distribution and learning – are argued to be useful in conceptualising possible CDAA technologies. These aspects are all currently ignored or downplayed in conventional approaches to accounting for non-financial matters, limiting accounting’s ability to promote more socially just and ecologically sustainable societies.
Originality/value
The authors introduce Jasanoff’s work on technologies of humility to show how CDAA, informed by Jasanoff’s proposed focal points, can help to expose controversial issues that powerful interests prefer to obscure, to surface the normative foundations of technocratic analytic methods, to address the need for plural perspectives and social learning and to bring all these aspects “into the dynamics of democratic debate” (Jasanoff, 2003, p. 240). As such, they provide criteria for constructing accounting technology consistent with agonistics-based CDAA.
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Brian Anthony Burfitt, Jane Baxter and Jan Mouritsen
The purpose of this study is to characterise types of practices – or “routings” as they are denoted in this paper – that have been developed to incorporate non-financial…
Abstract
Purpose
The purpose of this study is to characterise types of practices – or “routings” as they are denoted in this paper – that have been developed to incorporate non-financial inscriptions, representing value-in-kind (VIK) sponsorship resources, into accounting systems.
Design/methodology/approach
This study adopts field-based research, utilising Latour's (1999) concept of “circulating reference”, to illustrate how VIK (non-cash) resources were managed in an Australian sporting organization.
Findings
This paper contributes to our understanding of: first, how accounting infrastructure is constituted and stabilised by a network of multiple and overlapping accounting practices; second, how VIK resources are allocated and managed via local practices; and third, the importance of “budget relief” as a method of valuation in accounting practice.
Research limitations/implications
Our paper has implications for understanding how financial and non-financial accounting inscriptions are related in practice, requiring both integration and separation within networks of multiple and overlapping routings of accounting practices.
Originality/value
Our work highlights previously unexplored accounting practices, which assist in the process of utilizing VIK resources in the context of a sporting organization.
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Gordon Boyce and Lachlan McDonald-Kerr
This paper investigates how contemporary public policy for public-private partnerships (PPPs) deals with non-financial values and thereby shapes the way social, cultural and…
Abstract
Purpose
This paper investigates how contemporary public policy for public-private partnerships (PPPs) deals with non-financial values and thereby shapes the way social, cultural and environmental issues are accounted for.
Design/methodology/approach
A case study critically analyses PPP policy in Victoria, Australia, an acknowledged leader in the area. The investigation of the policy’s approach to non-financial value focusses on the treatment of social and environmental issues, particularly in relation to indigenous cultural heritage values.
Findings
It is found that important non-financial issues are characterised as risks to be quantified and monetised in PPP project assessment. A critical analysis shows that this approach obscures many significant dimensions of social, environmental and Indigenous cultural heritage value. The resultant relegation of non-financial values in public discourse and decision-making is seen to entrench unsustainable practices.
Social implications
The paper shows how public policy may shape actions and outcomes that impact directly on social, environmental and indigenous cultural heritage values.
Originality/value
This study provides insights into contemporary social and environmental accounting and accountability for PPPs. It adds to the understanding of the implications of public policy framings of non-financial values.
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A.M.I. Lakshan, Mary Low and Charl de Villiers
The international integrated reporting framework encourages organisations to disclose material information that affects their ability to create value. This paper aims to…
Abstract
Purpose
The international integrated reporting framework encourages organisations to disclose material information that affects their ability to create value. This paper aims to investigate the challenges and techniques preparers of integrated reports use to determine the materiality of non-financial information.
Design/methodology/approach
This paper uses an exploratory interpretive thematic analysis and an archival research approach. Qualitative semi-structured interviews were conducted with 55 integrated reporting (IR) preparers in 12 publicly listed companies, supported by the perusal of the companies’ integrated annual reports over a three-year period.
Findings
IR preparers find materiality determination for non-financial information challenging. This study found that preparers convert challenges into opportunities by using materiality disclosures as image-enhancing marketing tools, which causes concerns regarding weak accountability and a deviation from the International Integrated Reporting Council’s objective of improving information quality. This study found that IR preparers use various techniques in conjunction to determine materiality levels, as well as whether to disclose non-financial information in their integrated reports. The institutional isomorphism lens used in the study highlighted the issues IR preparers faced in their determined efforts of IR materiality levels under mimetic and normative isomorphism pressures.
Research limitations/implications
The challenges and techniques identified can contribute to the development of a framework for materiality level determination for non-financial information.
Practical implications
Regulators who are concerned with ensuring sufficient information to improve investor decision-making will be interested in the techniques IR preparers use to determine materiality levels for non-financial information, to improve their regulations and frameworks.
Originality/value
This study contributes to the literature regarding challenges with materiality level determination in integrated reports and techniques used by IR preparers. The application of an institutional isomorphism lens led to greater insight and understanding of IR preparers’ challenges and techniques in materiality determination. This paper makes a number of significant contributions to the IR literature. First, it identifies the usefulness of material information for decision-making and the influence stakeholders have on the materiality determination of non-financial information, which have not been mentioned in the prior literature. Second, the literature is silent on how organisations relate materiality to value creation for the purposes of determining the materiality content of an integrated report; this research provides empirical evidence of the use of value creation criteria in materiality determination. Third, the study highlights that materiality is a combination of efforts that involves everyone in an organisation. Further, the strategy should be linked to IR and preparers have indicated that integrated thinking is required for materiality determination.
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Josef Baumüller and Karina Sopp
This paper outlines the development of the principle of materiality in the European accounting framework, from the Modernization Directive (2003/51/EC) to the NFI Directive…
Abstract
Purpose
This paper outlines the development of the principle of materiality in the European accounting framework, from the Modernization Directive (2003/51/EC) to the NFI Directive (2014/95/EU) and on to the proposals for a Corporate Sustainability Reporting (CSR) Directive (2021/0104 (COD)). The authors highlight how the requirements for corporate reporting in terms of sustainability matters have changed, underlining the main issues that require further attention by practitioners, researchers and legislators.
Design/methodology/approach
This paper is based upon a historic analysis of European Union (EU) regulations in the field of non-financial and sustainability reporting and how these have changed over time. A conceptual comparison of different reporting concepts is presented, and changes in their relevance to the EU accounting framework are discussed as part of the historic analysis. Implications from corporate practice are derived from previous empirical findings from the EU Commission's consultations.
Findings
The proposed change from non-financial to sustainability reporting within the EU affects more than simply the terminology used. It implies that a different understanding is needed of both the purposes of company reporting on sustainability matters and the aims of carrying out such reporting. This change was driven by the need and desire to appropriately interpret the principle of materiality set forth in the NFI Directive. However, the recent redefinition in the shift within the EU Commission's proposals presents considerable challenges–and costs–in practice.
Research limitations/implications
Future research on the conceptualization and operationalization of ecological and social materiality, as well as on the use of this information by different stakeholder groups, is necessary in order to (a) help companies that are applying the reporting requirements in practice, (b) support the increased harmonization of the reports published by these companies and (c) fully assess the costs and benefits associated with the increase in reporting requirements for these companies.
Practical implications
Companies have to establish relevant reporting processes, systems and formats to fulfil the increasing number of reporting requirements.
Originality/value
This paper outlines the historic development of the principle of materiality regarding mandatory non-financial or sustainability reporting within the EU. It outlines a shift in rationales and political priorities as well as in implications for European companies that need to fulfil the reporting requirements. In consequence, it describes appropriate interpretations of this principle of materiality under current and upcoming legislation, enabling users to apply this principle more effectively.
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Joanna Krasodomska, Jan Michalak and Katarzyna Świetla
This paper aims to explore accountants’ views on mandatory corporate social responsibility (CSR) reporting. It focuses on three main factors underpinning their understanding and…
Abstract
Purpose
This paper aims to explore accountants’ views on mandatory corporate social responsibility (CSR) reporting. It focuses on three main factors underpinning their understanding and attitude towards non-financial disclosures: general understanding of the concept, gender and work experience.
Design/methodology/approach
The study uses social identity theory as the theoretical framework. The findings are based on a survey conducted among 73 accountants in 2018. The questionnaire consisted of 86 questions divided into 9 main areas. The Mann–Whitney U test was used to determine if there are any significant differences between the accountants’ attitudes towards non-financial disclosures.
Findings
Study results suggest that the general knowledge of CSR reporting among accounting specialists is insufficient. The attitude towards mandatory CSR disclosures significantly differs between accountants who participated in training related to non-financial reporting and those who did not. Contrary to expectations, there were no significant differences in responses either between female and male accountants or between accountants at the beginning of their career path (with experience shorter than five years) and the more experienced ones. The paper contributes to social theory studies as it refers to the problem of the influence of professional associations, governments and big accounting firms on the transformation of accountants’ social identity. It also discusses the relations between the characteristics influencing personal identity and social identity of accountants in shaping their attitude towards mandatory non-financial disclosures.
Practical implications
The findings could be of interest to the higher education and professional certification institutions which should consider bringing accounting curricula more closely to the realities of the current business environment.
Originality/value
The study contributes to the body of literature mainly because it investigates a diversified sample of accountants in a relatively unexplored institutional setting. It may also serve as a starting point for research that more broadly explores accountants’ engagement in non-financial disclosures on CSR.
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Muhammad Bilal Farooq, Asem Saad Ali Azantouti and Rashid Zaman
This study aims to review the literature on non-financial information (NFI) assurance including external assurance of sustainability reports (SRA) and integrated reports (IRA)…
Abstract
Purpose
This study aims to review the literature on non-financial information (NFI) assurance including external assurance of sustainability reports (SRA) and integrated reports (IRA). The objectives are as follows: provide an overview of academic research; understand the nature of NFI assurance engagements by organising the literature around the five key elements of an assurance engagement; develop a framework for understanding NFI assurance; and provide directions for future research.
Design/methodology/approach
The study undertakes a structured literature review of 179 articles published from 1999 to 2023.
Findings
The review identified 324 researchers located in 35 different countries who published 179 articles on SRA and IRA. The researchers, their locations, journals, methods, theories and themes are examined. The literature is structured around the definition of an assurance engagement including a tripartite arrangement, subject matter, a suitable criterion, sufficient appropriate evidence and a written assurance report. A framework for understanding NFI assurance is offered. Avenues for future research, structured around the five elements of an assurance engagement, are presented.
Practical implications
Researchers will benefit from an overview of the literature and guidance on areas for future research. Lecturers can use the findings to develop content for their auditing courses. Reporting managers will benefit from a better understanding of this new form of assurance. Regulators can use this study’s insights to better inform the development of laws and corporate governance codes mandating NFI assurance. Standard setters can use these findings to guide the emergence of the new assurance standards. Assurance practitioners may use this research to inform practice.
Social implications
The findings may prove useful in addressing capture, which deters NFI assurance from enhancing disclosure credibility and fulfilling its transparency and accountability role. This is to the detriment of the wider society.
Originality/value
The consolidation of the literature around the five key elements of an assurance engagement is unique. The framework devised offers useful insights into the dynamics of assurance generally and NFI assurance more specifically. The study is timely given the new European Union regulations on NFI reporting and assurance and the work of the International Audit and Assurance Standards Board in developing a specialist NFI assurance standard.
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A number of Management Accounting (MA) researches have demonstrated the shortcomings of traditional accounting‐based performance measures for today’s uncertain Economic Conditions…
Abstract
A number of Management Accounting (MA) researches have demonstrated the shortcomings of traditional accounting‐based performance measures for today’s uncertain Economic Conditions (EC) in technologically advancement competitive environments. The MA literature suggests the impact of economic pressures on MA practices, though there are different notions regarding the impact of EC on Non‐financial Performance Measurement (NFPM). Some researchers argue that management needs an interactive information system in more volatile and uncertain EC, and accordingly, the mode of the use of financial performance measures is greater in uncertain EC. However, some welldocumented predictions about the relationship of the external environmental, viz a viz uncertain economic environments, with the need of managers’ financial and nonfinancial information. Taking these aspects into account, it is important to consider the effect of EC on MA performance measures and their degree of responsiveness and adaptability to particular circumstances. Thus, this research made an attempt to study the impinge of EC on NFPM in Banks/Financial Institutions (BFI). The multiple case study approach, especially the study of different kinds of BFI in different macro environments, provides an opportunity to examine the effect of NFPM in different environments. The cross‐country studies help to demonstrate the rationale for the impact of EC on NFPM in three countries (Finland, Sweden and Japan). Results of this study anticipate that the uncertainty of EC increase pressures on management to improve and measure financial performance in order to survive in the hostile EC. To the contrary, managers would improve as well as measure non‐financial performance in the organizations.
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Jörn Obermann and Patrick Velte
This systematic literature review analyses the determinants and consequences of executive compensation-related shareholder activism and say-on-pay (SOP) votes. The review covers…
Abstract
This systematic literature review analyses the determinants and consequences of executive compensation-related shareholder activism and say-on-pay (SOP) votes. The review covers 71 empirical articles published between January 1995 and September 2017. The studies are reviewed within an empirical research framework that separates the reasons for shareholder activism and SOP voting dissent as input factor on the one hand and the consequences of shareholder pressure as output factor on the other. This procedure identifies the five most important groups of factors in the literature: the level and structure of executive compensation, firm characteristics, corporate governance mechanisms, shareholder structure and stakeholders. Of these, executive compensation and firm characteristics are the most frequently examined. Further examination reveals that the key assumptions of neoclassical principal agent theory for both managers and shareholders are not always consistent with recent empirical evidence. First, behavioral aspects (such as the perception of fairness) influence compensation activism and SOP votes. Second, non-financial interests significantly moderate shareholder activism. Insofar, we recommend integrating behavioral and non-financial aspects into the existing research. The implications are analyzed, and new directions for further research are discussed by proposing 19 different research questions.
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