The effectiveness of laws for improving the quality of non-financial reporting

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Issue Date
2023-07-06
Language
en
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Abstract
This study explores the impacts of the implementation of Directive 2014/95/EU (Non-Financial Reporting Directive (NFRD)) and the announced Directive 2022/2464/EU (Corporate Sustainability Reporting Directive (CSRD)) on the effectiveness for improving the quality of non-financial reporting across Dutch public companies that were subject to the Directive 2014/95/EU. By conducting a qualitative analysis, the annual reports from both 2017 and 2022 of 49 Dutch companies are analysed. The results show that the implementation of the NFRD did not achieve the goal of companies providing comparable data with regard to their non-financial disclosure. The broadness of the directive caused a widespread range of reported data and used manners to express the data. Furthermore, the results show a significant improvement in the number of companies reporting comparable data in the years following the implementation of NFRD. This suggests that companies have actively anticipated the announced CSRD by collecting and reporting more comparable data regarding environmental matters and thus suggests that the implementation and announcement of new non-financial regulations have improved the quality of reporting.
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Faculteit der Managementwetenschappen
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