An institutional theory perspective on non-financial reporting

Abstract

Purpose The paper aims to explore the impact of institutional factors on non-financial reporting in the Baltic countries. The vast majority of research in the scientific literature references practices of sustainable disclosures in developed countries with a focus on legal factors and their effect on corporate reporting. Meanwhile, there is a lack of in-depth empirical data for identifying correlations between institutional (mandatory, normative and company-specific) factors and non-financial reporting in developing countries. Design/methodology/approach The theoretical framework of neo-institutional theory was applied to explore how the external environment affects practices of non-financial reporting in developing countries. The approach used in the paper is quantitative. Findings The research results reveal that if companies are likely to disclose voluntarily one of non-economic aspects in their reports, they are also likely to disclose more about the other non-economic issues. However, no significant correlations were detected between the disclosure of voluntary (non-economic) and mandatory (economic) aspects. Mandatory factors promote both – economic and non-economic reporting – while normative and company-specific factors promote non-economic reporting more. Practical implications The authors contribute to the foreign investors and practitioners by helping to better understand corporate non-financial reporting practices in post-communistic countries. Originality/value The research adds to the growing body of research on non-financial reporting practices with particular reference to the developing Baltic context. This study also contributes to scientific literature by exploring the impact of different institutional factors to non-financial reporting in developing countries.

Assessing the Effects of Directive 2014/95/EU on Nonfinancial Information Reporting: Evidence from Italian and Spanish Listed Companies

“…The specific national requirements set by the Italian and Spanish laws are shown in Table 1. Numerous studies have highlighted the role of legal provisions in the disclosure of NFI (Moseñe et al 2013;García-Sánchez et al 2016;Martínez-Ferrero and García-Sánchez 2017;Dagilienė and Nedzinskienė 2018;Tiron-Tudor et al 2019;Aureli et al 2020;Tarquinio et al 2020). These studies have used institutional theory as a conceptual framework, showing how the institutional environment in which companies operate influences corporate disclosure practices (Shabana et al 2017;Lombardi et al 2021).…”

Corporate impact of carbon disclosures: a nonlinear empirical approach

“…Third, another implication Corporate impact of carbon disclosures concerns online presence and reputation: this can be considered as a new construct to be researched in the digital era, taking into account previous research on online transparency, social media presence and digital reporting. Interesting applications could be the use of digital solutions, like XBRL, for environmental reporting (Flores-Muñoz et al, 2018) and the use of the online metric in explaining the impact of institutional factors on non-financial reporting in developing countries (Dagilien_ e and Nedzinskien_ e, 2018).…”

Sustainability Information in Annual Reports of Companies Domiciled in the Czech Republic and the Slovak Republic

“…In the context of Central and Eastern Europe, there are several up-to-date English-language articles on sustainability reporting published in high-quality journals (e.g., Dagiliene, 2010;Dagiliene & Nedzinskiene, 2018;Gallen & Peraita, 2018;Habek, 2014;Habek & Wolniak, 2015;Horvath et al, 2017;Kundeliene & Stepanauskaite, 2018;Kunz, Ferencova, Hronova, & Singer, 2015;Lock & Seele, 2016;Szczepankiewicz & Mucko, 2016;Tetrevova, 2018, Waniak-Michalak, Sapkauskiene, & Leitoniene, 2018). If we look at the articles from the viewpoint of the countries analyzed, there are only two papers aimed at the Czech Republic, both of which analyze reporting through corporate websites.…”