Purpose This paper aims to investigate how firms disclose the presentation and content of business model (BM) information in corporate reports to manage their legitimacy in response to European Directive 2014/95. Design/methodology/approach Legitimacy theory is used to identify disclosure strategies pursued by firms in reaction to the new regulation. To understand how firms adopt these strategic responses, semiotic analysis is applied to a sample of European companies’ reports through Crowther’s (2012) framework, which is based on a mechanism of binary oppositions. Findings Half of the sample strategically choose to comply with the European Union (EU) Directive regarding BM information through the use of non-accounting language, figures, and diagrams. Other firms did not disclose any substantive information but managed the impression of compliance with the regulation, while the remainder of the sample dismissed the regulation altogether. Research limitations/implications This study demonstrates how organisations use the disclosure of BM information in their corporate reports to control their legitimacy. The results support the idea that firms can acquire legitimacy by complying with the law or giving the impression of compliance with the regulation. This study provides evidence on the first-time adoption of the EU Directive, and therefore, future research can enlarge the sample and conduct the analysis over a broader time frame. Practical implications A more precise indication of the EU Directive regarding “where” firms should report BM information, “how” the description of a BM should refer to the environmental, social, governance (ESG) factors, and a set of performance measures to track the evolution of a company’s BM overtime is needed. Originality/value While there has been a notable amount of research that has applied content analysis methodologies to investigate the thematic and syntactic aspects of BM disclosure in corporate reports, only a few studies have investigated BM disclosures in relation to the EU Directive. Furthermore, the application of semiotic analysis extends beyond traditional content analysis methodologies because it considers the structure of the story at many levels, thus developing a more complete textual picture of how BMs are described, allowing an analysis of the reasons behind the disclosure strategies pursued by firms.
Purpose The purpose of this paper is to examine the potential for eXtensible Business Reporting Language (XBRL) to go beyond static reporting. A taxonomy structure of information is developed for providing a knowledge base and insights for an XBRL taxonomy for integrated reporting (IR). Design/methodology/approach Design Science (DS) research, as a pragmatic exploratory research approach, is embraced to create a new “artefact” and thematic content analysis is used to analyse IR in practice. Findings Using XBRL for IR allows a shift from static and periodic reporting to more relevant and dynamic corporate disclosure for stakeholders, who can navigate and retrieve customised disclosure information according to their interest by exploiting the multidimensionality of IR and overcome some of its criticisms. The bi-dimensional taxonomy structure the authors’ present allows users to navigate disclosure from two different perspectives (content elements (CE) and capitals), display specific themes of interest, and drill down to more detailed information. Because of its evidence-based nature and levels of disaggregation, it provides flexibility to preparers and users of information. Additionally, the findings demonstrate the need to codify sector-specific information for the CE, so that to direct the efforts toward the development of sector-specific taxonomy extensions in developing an XBRL taxonomy for IR. Research limitations/implications The limitations of DS research are, first, the artefact design and, second, its effects in practice. The first limitation stems from the social actors’ perspective taken into account to develop the taxonomy structure, which derives from the analysis of the reporting practices rather than a pluralistic approach and dialogic engagement. The second limitation relates to the XBRL taxonomy development process because, since the study is limited to the “design” phase being codification and structuring the knowledge base for an XBRL taxonomy, there is a need to develop a taxonomy in XBRL and then apply it in practice to empirically demonstrate the potential and benefits of XBRL in the IR context. Practical implications The taxonomy structure is targeted at entities interested in designing an XBRL taxonomy for IR. This is a call for academics and practitioners to explore the potential of technology to improve corporate disclosure and open up new projections for resurging themes on intellectual capital (IC) reporting with prospects for IC “fourth-stage” research focused on IC disclosure. Originality/value This is an interdisciplinary research employing the DS approach, which is rooted in information systems research. It is the first academic study providing pragmatic results for using XBRL in the context of IC and IR.
Abstract. XBRL (eXtensible Business Reporting Language) will soon be the leading means of corporate financial reporting. A key feature of its adoption relies on well-defined standard taxonomies, which should adequately reflect both the accounting standards and the reporting practices of firms. This study considers this issue, following the concept of -taxonomy fit‖ proposed by Bovee et al. (2002; and Bonsón et al. (2009a). The aim is to fill a specific gap in the previous literature, by analyzing the applicability of XBRL in the context of template-based accounting standards. Specifically, we assess the fit between the XBRL Italian GAAP Taxonomy and the traditional annual reports of Italian non-listed companies, which are required to file their financial statements in XBRL. The results show an almost perfect fit but with significant differences among the financial statements analyzed. In addition, the degree of misfit, when it occurs, depends on the sector, the size and the level of disaggregation of information provided by the companies.
The systematic adoption of the eXtensible Business Reporting Language (XBRL) for financial reporting represents a great challenge. Worldwide, a large number of regulators are making an effort to promote the adoption of this standard to simplify and enhance the communication of financial information. This requires the definition of well-structured taxonomies that can standardize and accommodate the content of financial reports prepared by firms. This study aims to analyze the regulator-led adoption of XBRL for financial reporting. It examines the XBRL taxonomies used by Italian firms to reflect their financial reporting under rulebased Italian GAAP and principles-based International Financial Reporting Standards (IFRS). We compare the alignment of the Italian GAAP taxonomy and the IFRS taxonomy with Italian companies' financial statements and find two different levels of fit. The results offer useful insights for regulators and policy makers in prescribing or establishing appropriate taxonomies. We illustrate the potential impacts of the different taxonomies on the quality of financial reporting in terms of comparability and potential loss of information. L'INFORMATION FINANCI ERE EN MODE XBRL : PCGR ITALIENS ET IFRS RÉSUMÉ L'adoption syst ematique de l'eXtensible Business Reporting Language (XBRL) dans la communication de l'information financi ere est un enjeu de taille. Partout dans le monde, de nombreuses autorit es de r eglementation s'efforcent de promouvoir l'adoption de cette norme pour simplifier et favoriser la communication d'information financi ere. Cette conversion exige la d efinition de taxonomies bien structur ees, aptes a normaliser et a traiter le contenu des rapports financiers pr epar es par les soci et es. Les auteurs ont pour but d'analyser l'adoption du XBRL dans la communication de l'information financi ere, a l'initiative des autorit es de r eglementation. Ils etudient les taxonomies XBRL utilis ees par les soci et es italiennes pour convertir leur information financi ere etablie conform ement aux PCGR italiens, fond es sur les r egles, et aux normes internationales d'information financi ere (IFRS), fond ees sur les principes. Les auteurs comparent l'alignement de la taxonomie des PCGR italiens et de celle des IFRS dans les etats financiers des soci et es italiennes et observent deux niveaux d'ad equation diff erents. Les r esultats fournissent aux autorit es de r eglementation et aux responsables de l' elaboration des politiques des renseignements utiles en ce qui a trait a la prescription ou a
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
hi@scite.ai
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.