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Article

Wendy Terblanche and Charl De Villiers

The purpose of this paper is to examine whether preparing an integrated report and/or whether cross-listing is associated with more intellectual capital (IC) disclosure.

Abstract

Purpose

The purpose of this paper is to examine whether preparing an integrated report and/or whether cross-listing is associated with more intellectual capital (IC) disclosure.

Design/methodology/approach

The paper compares the content of IC disclosures of matched samples of companies.

Findings

The findings show that companies preparing an integrated report disclose more IC information, and that companies exposed to international capital market pressures through cross-listing do not disclose more IC information.

Research limitations/implications

The findings imply that integrated reporting (IR) is likely to increase IC disclosures and also that future IC disclosure research may have to take into account whether companies prepare an integrated report.

Practical implications

The results will be of interest to the proponents of IC and of IR, including the developers of the IR framework, regulators and companies considering IR.

Originality/value

This is one of the first studies to assess the influence of preparing an integrated report on the level of IC disclosure.

Details

Journal of Intellectual Capital, vol. 20 no. 1
Type: Research Article
ISSN: 1469-1930

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Article

Charl de Villiers and Matteo Molinari

The purpose of this paper is to understand how communication strategies and the use of numbers can ensure the buy-in and cooperation of stakeholders.

Abstract

Purpose

The purpose of this paper is to understand how communication strategies and the use of numbers can ensure the buy-in and cooperation of stakeholders.

Design/methodology/approach

Drawing on legitimacy theory, this study analysis documents regarding the communication strategies of New Zealand (NZ)'s Prime Minster, Jacinda Ardern, during the COVID-19 pandemic, in order to extract lessons for organizations. The authors contrast Ardern's communications with those of Donald Trump, the President of the United States (US), as evidence that leaders do not necessarily follow these strategies.

Findings

The findings show that clear, consistent and credible communications, backed up by open access to the numerical data that underlie the decisions, ensure that these decisions are seen as legitimate, ensure that citizens/stakeholders feel leaders are accountable and believe in the necessity of measures taken and that they conform to the guidelines and rules. By contrast, the strategy of attempting to withhold information, blaming others, refusing to acknowledge that there are problems and refusing to address problems lead to non-conformance by citizens/stakeholders. Business leaders could apply these lessons to the management of crises in their organizations to ensure buy-in from employees and other stakeholders. Leaders and organizations that follow these communication strategies can emerge in a stronger position than before the crisis.

Research limitations/implications

This paper develops a theoretical framework of strategies aimed at maintaining and disrupting legitimacy among key audiences, which can be used in future research.

Practical implications

This paper highlighting how organizations and organizational leaders can best communicate with stakeholders using accounting, thus coming across as being accountable during crisis times.

Social implications

The legitimacy maintenance strategies outlined in this paper ensures that stakeholders feel leaders and the organizations they represent hold themselves accountable.

Originality/value

This paper outlines the lessons that an organization can learn from communication strategies adopted by governments during the COVID-19 crisis. The paper extends legitimacy theory by explicitly acknowledging the ability to disrupt the legitimacy of others and including this in the authors’ theoretical framework.

Details

Accounting, Auditing & Accountability Journal, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0951-3574

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Article

Rayhan Arul, Charl de Villiers and Ruth Dimes

This study aims to provide insights into the poorly understood concept of integrated thinking by comparing and contrasting disclosures related to integrated thinking…

Abstract

Purpose

This study aims to provide insights into the poorly understood concept of integrated thinking by comparing and contrasting disclosures related to integrated thinking provided in integrated reports in two different institutional settings.

Design/methodology/approach

The study uses content analysis of the narrative sections of integrated reports to explore similarities and differences in the way the concept of integrated thinking is portrayed. It uses a matched sample of financial services companies in two different institutional settings, South Africa (where integrated reporting (IR) is mandatory and IR practices are world-leading) and Japan (where IR is voluntary and interest in IR is still developing). IR adoption is viewed through the lens of institutional theory, focussing on isomorphic forces which affect companies’ structure, policies and practices.

Findings

Even though the conceptualisation of integrated thinking differs between South Africa and Japan, in both settings there is a strong association between integrated thinking disclosures and corporate governance practices, materiality assessments and the pursuit of an industry leadership position, suggesting a link between these concepts and the underlying level of integrated thinking. Japanese disclosures appear to mimic South African disclosures, highlighting South Africa’s leading role in IR, although Japan shows more varied interpretations of integrated thinking.

Originality/value

This study contributes to the growing body of literature on the poorly understood concept of integrated thinking, responding to calls from both academics and practitioners for more research in this area. It shows the potential for integrated thinking to develop through a process of mimicry and highlights South Africa’s leading role in the dissemination of best practice in the field. Its findings relating to the fluid conceptualisation of integrated thinking in different institutional settings will be of interest to regulators and practitioners. To the knowledge this is one of the first studies to consider disclosures relating to integrated thinking in the financial services sector. Focussing on the financial services sector, with its unique features and regulatory frameworks, allows for deeper analysis, free from the potential distortions inherent in studying a broader cross-section of industries. The study also highlights the importance of corporate governance to integrated thinking, suggesting future research avenues.

Details

Meditari Accountancy Research, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2049-372X

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Article

Federica Farneti, Federica Casonato, Monica Montecalvo and Charl de Villiers

The purpose of this study is to examine how social disclosures are influenced by the adoption of integrated reporting (IR), focusing on the three social capitals in the…

Abstract

Purpose

The purpose of this study is to examine how social disclosures are influenced by the adoption of integrated reporting (IR), focusing on the three social capitals in the international IR framework, namely, intellectual, human and social and relationship capital.

Design/methodology/approach

This study takes the form of a single case study involving content analyses of annual reports and integrated reports from 2009 to 2017 (i.e. before and after IR adoption in 2013), as well as in-depth, semi-structured interviews with key preparers of the integrated report at New Zealand Post, to study changes in disclosures towards different stakeholder groups, from an internal organisation perspective. The empirical evidence is analysed through the lens of stakeholder theory.

Findings

This study provides empirical evidence that contributes to our understanding of IR’s influence on the disclosure of social information and enhanced stakeholder relations in a public sector context. The study shows that the IR framework promoted a materiality assessment approach with stakeholders, which led to a reduction in social disclosures, while the materiality focus led to the disclosure of social matters more relevant to stakeholders.

Social implications

IR led to meaningful stakeholder engagement, which led to social disclosure that are more relevant to stakeholders.

Originality/value

This study assesses the influence of IR on social disclosures. The findings will be of interest to organisations seeking to enhance stakeholder relations and/or undertake IR and/or social disclosures.

Details

Meditari Accountancy Research, vol. 27 no. 4
Type: Research Article
ISSN: 2049-372X

Keywords

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Article

A.M.I. Lakshan, Mary Low and Charl de Villiers

Integrated reporting (IR) promotes the disclosure of future-oriented information to enable financial stakeholders to make better-informed decisions. However, the downside…

Abstract

Purpose

Integrated reporting (IR) promotes the disclosure of future-oriented information to enable financial stakeholders to make better-informed decisions. However, the downside to this type of disclosure is the risk to management of disclosing such future-oriented information. This paper aims to explore how IR preparers manage the risk of disclosing future-oriented information in companies’ integrated reports.

Design/methodology/approach

This study represents an exploratory interpretative thematic analysis of 33 semi-structured interviews with managers involved in IR in eight Sri Lankan companies representing various industries. The thematic analysis is informed by the research literature and prior studies on IR.

Findings

This paper provides evidence of various strategies to manage the risk associated with the disclosure of future-oriented information in integrated reports. These strategies include making non-specific predictions; increasing the accuracy of the predictions; linking performance management to disclosed targets, thus ensuring individual responsibility for target achievement; disclosing ex post explanations for not achieving previously disclosed targets; and linking disclosed targets to the company’s risk management procedures. However, these strategies can cause managers to provide conservative future-oriented information, rather than “best estimate” future-oriented information.

Practical implications

The study describes the strategies that managers use to mitigate the risks involved in disclosing future-oriented information. These strategies can provide support or raise concerns, for managers in deciding how to deal with such risks. Regulators tasked with investor protection, as well as stock exchanges interested in the transparency and accountability of listed companies’ activities should be aware of these strategies. Furthermore, the International Integrated Reporting Council (IIRC) should be interested in the implications of this study because some of the identified strategies could undermine the usefulness of integrated reports to stakeholders. This is a significant concern given that the IIRC envisages integrated reporting and thinking as vehicles that could align capital allocation and corporate behaviour with wider sustainable development goals.

Social implications

The trend of future-oriented information moving from being used only in organisations’ internal management systems to being externally reported in integrated reports has implications for stakeholder groups interested in the reported targets. This study reveals management strategies that could affect future-oriented information reliability and reduce their usefulness for users of integrated reports.

Originality/value

This study provides unique insights into the emerging area of how managers deal with the risks involved in disclosing future-oriented IR information.

Details

Sustainability Accounting, Management and Policy Journal, vol. 12 no. 2
Type: Research Article
ISSN: 2040-8021

Keywords

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Article

Muhammad Bilal Farooq and Charl de Villiers

The purpose of this paper is to examine how sustainability assurance providers’ (SAPs) promotion of sustainability assurance influences the scope of engagements, its…

Abstract

Purpose

The purpose of this paper is to examine how sustainability assurance providers’ (SAPs) promotion of sustainability assurance influences the scope of engagements, its implications for professional and managerial capture and the ability of sustainability assurance to promote credible reporting.

Design/methodology/approach

The authors conducted in-depth interviews with sustainability reporting managers (SRMs) and SAPs in Australia and New Zealand, using an institutional work lens to focus the analysis.

Findings

At the start of a new assurance engagement, SAPs offer pre-assurance and flexible assurance scopes, allowing them to recruit clients on narrow-scoped engagements. These narrow-scoped engagements focus on disclosed content and limit SAPs’ ability to add value and enhance credibility. During assurance engagements, SAPs educate managers and encourage changing the norms underlying sustainability reporting. At the end of the assurance engagement, SAPs provide a management report demonstrating added-value of assurance and encouraging clients broader-scoped engagements. However, with each assurance engagement, the recommendations offer diminishing returns, often leading managers to question the value of broad-scoped engagements and to consider narrowing the scope to realize savings. Under these conditions, client pressure (potentially managerial capture) along with practitioners’ desires to grow assurance income (potentially professional capture) can affect SAPs’ independence and the quality of their assurance work.

Practical implications

The study implies that regulation mandating the scope of engagements may be called for.

Originality/value

The authors contribute to the research literature in several ways. First, the findings show how professional and managerial capture occurs before, during and at the end of the assurance process. The authors highlight how perceived value addition from sustainability assurance diminishes over time and how this impacts the scope of engagements (with implications for SAPs independence and the quality of assurance work). The authors show these findings in a table, clarifying the complicated interrelationships. Second, the authors contribute to theory by identifying a new form of institutional work. Third, unlike previous studies focused on SAPs, the authors provide insights from the perspectives of both SAPs and SRMs.

Details

Accounting, Auditing & Accountability Journal, vol. 33 no. 2
Type: Research Article
ISSN: 0951-3574

Keywords

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Article

Desi Adhariani and Charl de Villiers

This paper aims to explore the perspectives of corporate report preparers and other stakeholders on integrated reporting (IR) in a major Southeast Asian economy.

Abstract

Purpose

This paper aims to explore the perspectives of corporate report preparers and other stakeholders on integrated reporting (IR) in a major Southeast Asian economy.

Design/methodology/approach

A survey is used to explore perspectives on IR.

Findings

There is a limited level of knowledge regarding IR, but a high level of interest. Corporate report preparers paradoxically state that they can see the benefits of IR, yet they are reluctant to implement it.

Practical implications

Changes to university curricula, training sessions, seminars and conferences may be needed to disseminate information regarding IR.

Social implications

IR implementation may be stymied by the low levels of knowledge in Southeast Asia and hence lack of demand from stakeholders. High-quality reporting generally supports capital flows into a region and thus influences economic and social well-being. The integrated financial and non-financial information needs of stakeholders thus have an indirect impact on society.

Originality/value

Southeast Asia is an economic powerhouse and home to hundreds of millions of people. It is important to understand the potential for IR in this region. This is the first survey of its kind to explore these matters.

Details

Sustainability Accounting, Management and Policy Journal, vol. 10 no. 1
Type: Research Article
ISSN: 2040-8021

Keywords

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Article

Leonardo Rinaldi, Jeffrey Unerman and Charl de Villiers

The purpose of this paper is to identify key challenges, opportunities, strengths and weaknesses experienced by the integrated reporting (IR) idea since the International…

Abstract

Purpose

The purpose of this paper is to identify key challenges, opportunities, strengths and weaknesses experienced by the integrated reporting (IR) idea since the International Integrated Reporting Council (IIRC)’s Discussion Paper was published in late 2011. It provides insights into the phases of the IR journey as investigated by accounting researchers, identifies important gaps in the literature and sketches an agenda for future research.

Design/methodology/approach

The paper develops a theoretically informed analysis of published IR research articles using the idea journey theoretical framework. The paper draws upon academic analysis and insights published in 65 IR-related articles across 83 accounting journals listed in the Scopus database.

Findings

A key insight of the paper is that the academic literature has not yet covered all stages of the IR idea journey. The highest proportion of articles provide insights in the generation and production phases of this journey, while there is relatively little research into the impact phase of the IR idea. Furthermore, the locus of research covered by the current IR literature is situated at macro- and meso-levels. This reveals opportunities for future research to explore, at a more detailed level, interactions between single individuals or small groups in implementing or understanding the IR idea.

Research limitations/implications

This paper focuses on the idea journey of the IIRC’s version of IR. It identifies gaps regarding the stages of the IR idea journey that have not been covered by the extant academic literature and suggests some research areas that need to be addressed to help inform improvements in policy and practice. A key limitation is that it draws on a single communication channel, namely, academic articles published in accounting journals, but it provides opportunities for considerable further developments.

Originality/value

The paper extends IR research by reconciling insights from an understandably fragmented emerging literature. It provides a multi-dimensional perspective on IR, highlighting the dynamics and interrelationships in the literature. It also helps inform improvements in research, policy and practice by identifying gaps regarding the stages of the IR idea journey that have not been covered by the extant academic literature. Lastly, the paper builds on the work of innovation and creativity scholars showing how the idea journey framework can be used to shape and add coherence to accounting research.

Details

Accounting, Auditing & Accountability Journal, vol. 31 no. 5
Type: Research Article
ISSN: 0951-3574

Keywords

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Article

Charl de Villiers, Pei-Chi Kelly Hsiao and Warren Maroun

This paper aims to develop a conceptual model for examining the development of integrated reporting, relate the articles in this Meditari Accountancy Research special…

Abstract

Purpose

This paper aims to develop a conceptual model for examining the development of integrated reporting, relate the articles in this Meditari Accountancy Research special issue on integrated reporting to the model and identify areas for future research.

Design/methodology/approach

The paper uses a narrative/discursive style to summarise key findings from the articles in the special issue and develop a normative research agenda.

Findings

The findings of the prior literature, as well as the articles in this special issue, support the conceptual model developed in this paper. This new conceptual model can be used in multiple ways.

Originality/value

The special issue draws on some of the latest developments in integrated reporting from multiple jurisdictions. Different theoretical frameworks and methodologies, coupled with primary evidence on integrated reporting, construct a pluralistic assessment of integrated reporting, which can be used as a basis for future research. The new conceptual model developed in this paper can be used as an organising framework; a way of understanding and thinking about the various influences; a way of identifying additional factors to control for in a study; and/or a way of identifying new, interesting and underexplored research questions.

Details

Meditari Accountancy Research, vol. 25 no. 4
Type: Research Article
ISSN: 2049-372X

Keywords

Abstract

Details

Pacific Accounting Review, vol. 26 no. 1/2
Type: Research Article
ISSN: 0114-0582

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