The role of stakeholders in the relationship between integrated thinking and corporate reporting quality
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2020-07-08
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en
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Abstract
Share- and stakeholders are increasingly pressuring organisations to provide high quality financial and nonfinancial information. However, how organisations are supposed to increase their reporting quality is still up for debate. Recently, the International Integrated Reporting Council (IIRC) has promoted integrated thinking as a means to increase an organisation’s reporting quality. This study examines whether integrated thinking has an effect on corporate reporting quality and how this relationship is moderated by an organisation’s stakeholder engagement and by the legal system of the country in which an organisation is located. Using a sample of 4550 firm-year observations of publicly listed firms in 19 European countries during the years 2008-2017, this study finds that integrated thinking has a positive effect on corporate reporting quality. The results also indicate that stakeholder orientation has a negative moderating effect on this relationship, whereas stakeholder engagement does not have a moderating effect on this relationship. The findings of this study suggest that integrated thinking can increase an organisation’s reporting quality. Implications for organisations and regulators are discussed.
Keywords: integrated thinking, corporate reporting quality, financial reporting quality, nonfinancial reporting quality, stakeholder engagement
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Faculteit der Managementwetenschappen