Learning from the Best: New Challenges and Trends in IR Reporters’ Disclosure and the Role of SDGs

Abstract

<jats:p>A worldwide debate on the effectiveness of business reporting information has engaged organizations, policy makers, regulators, and members of the capital market. The documents through which organizations disclose their annual performance are being questioned and criticized, as they appear inadequate for responding to stakeholder needs. In 2013, the International Integrated Reporting Council (IIRC) launched a project with the aim of redesigning corporate reporting processes and outputs, introducing integrated reporting (IR). At the center of IR are the six capitals defined by the IIRC representing the basis for an innovative form of evaluating and presenting performance. New topics on the global sustainable development agenda are growing in importance, requiring companies to enrich their disclosure and connect business to environment. In this study, we examined how a group of leaders in IR, 134 European companies from the IIRC IR reporters list, are currently disclosing IR capital and Sustainable Development Goals (SDGs), developing three evaluation scores: Capital Disclosure Index, SDG Disclosure Index, and SDG Compliance Index.</jats:p>

Italy versus Other European Countries: Sustainable Development Goals, Policies and Future Hypothetical Results

“…Worldwide, 1 billion people still The role of business in the pursuit of sustainability should not be forgotten; companies play a fundamental role as they can change the perception of environmental issues, both towards their customers and all stakeholders. An increasing number of companies are in fact making efforts toward corporate sustainability [54], causing this topic to become increasingly important both for companies and their stakeholders, as well as that part of the doctrine that addresses how the SDGs are currently pursued by companies [55]. Below, for each SDG, the main goals that are to be pursued will be outlined.…”

Non-financial Disclosure and Materiality: Exploring the Role of CFOs

“…This trend, which arises from a regulatory basis, could be an opportunity for companies to communicate non-financial information, sustainability issues, and if and how they are contributing to achieving the SDGs. Overall, it is like moving from the question on whether and how many companies refer to the SDGs as mere citation (some authors speak of former "green washing" or nowadays "rainbow washing," Izzo et al, 2020), or if they make the effort to define, monitor, and even provide internal objectives, as well as the results, linked to non-financial targets, such as SDGs.…”

Assessing the implementation of sustainable development goals: does integrated reporting matter?

“…Therefore, the minimum score for a company would be equal to 0 points (if it did not support any of 17 SGDs), and the maximum score that a company can achieve would be equal to 17 points (1*17 SDGs). This means the index score values range from 0 to 100% (Izzo et al , 2020b).…”

“…Nevertheless, integrated reporting (IR) could play a significant role in enhancing the SDG's disclosure by providing the culture, strategy and tools to turn such SDGs into measurable business activities (Curtó-Pagès et al , 2021). IR has been praised as a helpful communication tool for assisting businesses in coordinating their business strategies and sustainable value-creation procedures with challenges related to the environment, societal prosperity, and SDGs activities (Izzo et al , 2020b; Nicolò et al , 2022). Therefore, we suppose that firms with high-quality IR may provide a higher level of SDGs disclosure.…”