Constituents’ formal participation in the IASB’s due process: New insights into the impact of country and due process document characteristics.

Abstract

This paper adopts a multi-issue/multi-period approach to provide new insights into key determinants of constituents’ formal participation in the due process of the International Accounting Standards Board (IASB). Based on an analysis of 8,825 comment letters submitted during the period 2006–2012, we find imbalances in the representation of constituents. Multiple regressions reveal that among various economic and cultural variables equity market capitalization and the society’s level of individualism are the key drivers of the country-level of constituents’ participation, and each variable has explanatory power over the other. The level of constituents’ participation is positively associated with the number of input opportunities offered by a due process document but unrelated to the complexity of a standard-setting project. The results are robust across various sub-samples and to additional sensitivity tests. Our findings indicate threats to the input legitimacy of the IASB and suggest avenues to stimulate constituents’ participation.

Completeness of the qualitative characteristics using Foucauldian critical discourse analysis and content analysis paradigms: towards a revised conceptual framework

“…The lack of widespread participation in the IFRS setting process can be criticised, particularly in the light of the financial crisis of 2008. Comment letters are assigned a pivotal role in the deliberations process and it is just such input as comment letters that affords input legitimacy, where constituents that are affected by the standard, have been seen to have contributed towards the standard-setting process (Dobler and Knospe, 2016).…”

International Accounting Standards in Africa: Selective Recursivity for the ‘Happy Few’?

“…Our analysis of comment letters on IFRS 9 and the Conceptual Framework show that participation of African stakeholders in the IASB's due process is as low as 3 per cent of all submitted letters (Tables 4 and 5 in the online Appendix). These findings are reinforced by Dobler and Knospe (2016) who report that on average only 4.5 comment letters on different IFRS projects came from Africa during the period 2006-12, compared to 50.2 from Europe, 46.8 from North America, 28.5 from Asia/ Oceania, and 1.8 for South America. According to this study, 63 per cent of all African comment letters came from South Africa alone and the remaining letters mostly from countries with active capital markets or strong ties to the Anglo-Saxon accounting tradition with arguably less conceptual mismatch than in countries with French or other accounting influences.…”

Stakeholder participation in the ISSB’s standard-setting process: the consultations on the first exposure drafts on sustainability reporting

“…The first strand is the largest and is closely related to our study. This strand includes large-scale studies using a multi-issue/multi-period approach to investigate stakeholder participation through CLs by stakeholder group (Jorissen et al , 2012; Larson, 2007), by jurisdictional origin (Jorissen et al , 2006, 2013; Larson and Herz, 2011, 2013) or both (Dobler and Knospe, 2016b). With regard to stakeholder groups, key findings demonstrate that preparers of financial statements participate more frequently than any other stakeholder group, including users of financial statements.…”

“…These results indicate imbalances in participation across and within stakeholder groups and across jurisdictional origins. Dobler and Knospe (2016b), along with mixed results on individual consultations (Georgiou, 2010; Giner and Arce, 2012; Jorissen et al , 2006; Kosi and Reither, 2014), further suggest that the patterns of stakeholder participation are related to the phase of the standard-setting process and the characteristics of the standard to be set.…”

“…Sutton (1984) developed his framework in a national setting, focusing on differences between stakeholder groups (and within the stakeholder group of preparers) in participation with a national standard-setter. Although Sutton (1984) did not consider an international setting, research has adopted his framework, and its inherent cost–benefit considerations at an international level to explain differences in participation across jurisdictions (Dobler and Knospe, 2016b; Jorissen et al , 2013; Orens et al , 2011). Therefore, the development of our hypotheses related to stakeholder groups grounds more directly on Sutton (1984) than the development of our hypotheses related to jurisdictional origin.…”