Integrated reporting: Much ado about nothing?

Graaff, Brigitte de; Steens, Bert; Camfferman, Kees

doi:10.3280/fr2021-002004

Cited by 4 publications

(5 citation statements)

References 61 publications

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“…The academic literature on IR attributes many benefits to the adoption of IR (Vitolla et al , 2019), although previous research has indicated that these presumed benefits are not always substantiated with evidence (De Graaff et al , 2021). The IIRC promotes many of these organizational benefits as positive effects of IR adoption, dividing them into two categories: connectivity benefits and performance benefits.…”

Section: Literature Review Theoretical Framework and Proposition Deve...mentioning

confidence: 99%

Integrated reporting: exploring supervisory board members’ perspectives on the motives, drivers and benefits

Graaff

Steens

2022

JAOC

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Purpose The purpose of this paper is to explore the perceived benefits of integrated reporting (IR) and factors influencing the motives that supervisory board members (SBMs) have for advocating a change towards IR implementation. Design/methodology/approach An exploratory survey study was conducted to investigate the influence of external market conditions, internal organizational conditions and observed benefits on the motivation to advocate IR adoption in companies that have not yet implemented IR. A unique set of survey data from 62 SBMs of Dutch companies was used for analysing the propositions derived from IR literature and based on institutional theory, legitimacy theory and diffusion of innovation theory. Findings The respondents indicated to be supportive of IR adoption. SBMs who had experienced the implementation of IR observed that IR offers benefits. Their motives for advocating a change towards IR in companies that had not implemented IR were influenced most by the observed benefits in IR companies. SBMs only involved in companies that had not adopted IR are motivated to support IR adoption to a similar extent. These findings suggest that directly observed benefits by SBMs need to exceed a considerable minimum level before these SBMs are more motived to advocate IR than their peers who have not witnessed the implementation of IR and that experiences are shared across companies. The motivation of both groups is influenced by external market conditions but not by internal organizational conditions. Practical implications The findings have implications for potential IR adopters and institutions promoting the further diffusion of IR as they emphasize the need for tangible benefits of IR and confirm that sharing good practices and benefits of IR can provide a catalyst for IR adoption. The findings contribute to the understanding of the motivation of SBMs as an important organizational condition for implementing IR as this study provides insights in the factors that drive this motivation of key actors influencing the decision to implement IR. Furthermore, the finding that these factors predominantly comprise tangible results and external market conditions is relevant from an organizational change perspective. Social implications Understanding the mechanisms of IR-adoption decisions provides a relevant basis for deploying programmes promoting IR as a general reporting standard. This could provide society and a broad range of stakeholders with access to information incorporated in integrated reports. It could ultimately have a major impact on society by improving decision-making and increasing the long-term sustainability of organizations and their relations with stakeholders. Originality/value This study provides preliminary empirical evidence concerning the perspectives of SBMs on their motives for advocating IR, based on a unique sample from a country that has been involved with IR from its start.

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Section: Literature Review Theoretical Framework and Proposition Deve...mentioning

confidence: 99%

Integrated reporting: exploring supervisory board members’ perspectives on the motives, drivers and benefits

Graaff

Steens

2022

JAOC

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“…The principal focus within the domain of IR research lies within the external reporting field (Dimes and De Villiers, 2020;De Graaff et al, 2021;IMA, 2021;. Although there is emergent literature on integrated thinking, it nevertheless still remains in its infancy (Busco et al, 2021).…”

Section: Development Of the Research Questionmentioning

confidence: 99%

“…The academic literature on IR attributes many benefits to the adoption of IR (Vitolla et al, 2019), although previous research has indicated that these presumed benefits are not always substantiated with evidence (De Graaff et al, 2021). The IIRC promotes many of these organisational benefits as positive effects of IR adoption, dividing them into two categories: connectivity benefits and performance benefits.…”

Section: Organisational Benefitsmentioning

confidence: 99%

“…did acknowledge the importance of studies focusing on the impact of IR on internal steering and control mechanisms, and this body of literature has subsequently grown slowly but steadily(Oliver et al, 2016;Feng et al, 2017;Arul et al, 2020;Busco et al, 2020). However, Velte and Stawinoga (2017),Gatti et al (2018), De Graaff et al (2021 andDimes and De Villiers (2020) show that there remains a relative dearth of systematic research available on the topic. This study answers multiple calls for research(De Graaff et al, 2021;Dimes and De Villiers, 2020;Busco et al, 2020) into integrated thinking by drawing on the management control literature and utilising this as a lens through which to study the relationship between IR and integrated thinking.The recent study byDimes and De Villiers (2020) employed a management control system (MCS) perspective to study how management control systems can either constrain or enable integrated thinking.Moreover, CIMA (2017)…”

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confidence: 99%

“…: External market factors and internal organisational factors covered by the questionnaire8 A review of these studies can be found in DeGraaff et al, 2021. …”

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confidence: 99%

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The (r)evolution of integrated reporting

de Graaff

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Since the foundation of the International Integrated Reporting Council (IIRC) in 2010, the concept of integrated reporting (IR) has gained widespread attention. The IR Framework as first published by the IIRC in 2013 aims to fulfil stakeholders’ demands by providing an overview in which all strands of information, and their attendant impact on the value creation process, are connected in the integrated report. Although the integrated report is an important outcome of IR, this product should ultimately be based on the process of integrated thinking. Integrated thinking fulfils a pivotal role in the integrated reporting process, but most of the attention has been given to the report as a product rather than to integrated thinking as a key internal process. The impact of IR adoption on the organisation internally, and the degree to which integrated thinking becomes visible in the organisation, has thus far remained underexposed. This dissertation studies the extent to which IR affects the observable presence of integrated thinking within performance management systems (PMSs). Through recourse to legitimacy theory and management fashion theory, a preliminary assessment of the development of IR is provided. The uncovered genealogy of claims about potential benefits of IR are explored in more detail by administering a survey among Dutch supervisory board members (SBMs). Both the perceived benefits of IR and the factors that influence the motives of SBMs to advocate for a change towards IR implementation are explored. The results also stress the iterative process that is taking place between IR and integrated thinking practices. Some of the claims about IR pertained to topics such as: the breaking down of silos within organisations, improved decision-making, better alignment between financial and non-financial information, and an overall more holistic business approach. These claims describe aspects which can be encompassed under the umbrella of integrated thinking. In this dissertation, integrated thinking is approached from a management control perspective. Through conducting case studies with four Dutch companies that have multiple years of experience with publishing integrated reports, it becomes apparent that each of the organisations experienced changes in their PMSs due to IR. The results of this dissertation show that due to IR implementation, integrated thinking is becoming visible in the PMSs, because PMSs are becoming more integrated with respect to financials and non-financials. This study also shows the iterative process between the concepts of IR and integrated thinking. These changing PMSs are in alignment (at least partially) with the espoused benefits of IR outlined in literature. Such an overview of the IR journey is expedient for both academics studying the concept of IR, and practitioners seeking a more complete understanding of what they can expect from IR implementation and what they can learn about the impact of IR and use of integrated thinking in practice. It also helps standard setters’, regulators’ and consultants’ attempts to provide more guidance to companies aiming to better understand the phenomenon of integrated thinking.

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Integrated Reporting and the experience of the Pilot Programme: perspective of an Italian pioneer company over ten years

Piedepalumbo,

Evangelista,

Mancini

et al. 2024

JAOC

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Purpose This study aims to propose a longitudinal analysis of motivations for Integrated Reporting (IR) adoption, internal changes, the benefits of IR implementation and compliance challenges. Design/methodology/approach The authors analyse a longitudinal case study of an Italian-listed company (Eni) participating in the IR-Pilot Programme (PP) and covering 10 years of IR adoption. The analysis was based on a mixed-method approach that included semi-structured interviews, content analysis of annual reports and triangulation with other data sources. Results are discussed regarding institutional theory, legitimacy theory and diffusion of innovation theory. Findings The study suggests that motivations for adopting IR change over time and participation in the IR-PP helps Eni acquire a comprehensive and substantial integrated view of value creation over time, makes integrated culture a key factor for strategic business sustainability and confirms the readiness of early adopters to comply with the non-financial Directive (NFD). Originality/value This study, among the few longitudinal case studies, provides organisations, regulators and academics with insights into the motivations driving the successful adoption and implementation of IR and the NFD. The results may help companies consider one of the tools currently deemed to bring sustainability into action and participation in pilot groups.

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Integrated reporting: Much ado about nothing?

Cited by 4 publications

References 61 publications

Integrated reporting: exploring supervisory board members’ perspectives on the motives, drivers and benefits

Integrated reporting: exploring supervisory board members’ perspectives on the motives, drivers and benefits

The (r)evolution of integrated reporting

Integrated Reporting and the experience of the Pilot Programme: perspective of an Italian pioneer company over ten years

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