Abstract
The 254/2016 Legislative Decree, which is implementing in Italy the Directive 2014/95/EU on Non-Financial Information (NFI), has made it mandatory to convey NFI to improve economic, social and environmental corporate communication. An effective mean to operationalize the law is the use of Sustainability Performance Indicators (SPIs). These are powerful tools for communicating companies’ NFI in a synthetic, consistent and comparable way, as confirmed also by the widespread use of the Global Reporting Initiative standard and guidelines that have their strength in the presence of SPIs. With the aim to investigate the effects produced by the new regulation, our chapter analyzes the SPIs disclosed in non-financial reporting produced before and after the 254/2016 Legislative Decree by a sample of Italian companies belonging to the “sensitive sectors” (those with high social and environmental impacts). We use a content analysis and a disclosure index of non-financial reports referring to the 2015–2017 financial years. The longitudinal analysis highlights a decrease of the overall quantity of NFI disclosed via SPIs and a general reduction in their average value, which was more evident in the first year in which the Decree entered into force. The reduction of the disclosure index can be related to the assessment of information reliability, in response to the legal requirement of NFI disclosure. This study is the first attempt to investigate the role played by Italian law on NFI reporting practices, concerning sustainability performance indicators. The results reveal how EU Directive can impact on country-specific regulation, tracing a possible trend on NFI disclosure throughout Europe.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
Notes
- 1.
For sector classification, we used the Industry Classification Benchmark code (ICB Code) provided by Thomson Reuters Datastream database (Datastream item identifier for financial firms: WC07040).
References
Adams, C. A., & Frost, G. R. (2008). Integrating sustainability reporting into management practices. Journal of Cleaner Production, 32, 288–302.
Adams, M., Thornton, B., & Sepehri, M. (2011). The impact of the pursuit of sustainability on the financial performance of the firm. Journal of Sustainability and Green Business, 1, 1–14.
Aureli, S., Gigli, S., Medei, R., & Supino, E. (2019). The value relevance of environmental, social, and governance disclosure: Evidence from Dow Jones sustainability world index listed companies. Corporate Social Responsibility and Environmental Management, 27, 43–52. https://doi.org/10.1002/csr.1772.
Bebbington, J., Kirk, E. A., & Larrinaga, C. (2012). The production of normativity: A comparison of reporting regimes in Spain and the UK. Accounting, Organizations and Society, 37(2), 78–94.
Beretta, S., & Bozzolan, S. (2008). Quality versus quantity: The case of forward-looking disclosure. Journal of Accounting, Auditing and Finance, 23, 333–376.
Boiral, O., Heras-Saizarbitoria, I., & Brotherton, M. C. (2019). Assessing and improving the quality of sustainability reports: The auditors’ perspective. Journal of Business Ethics, 155(3), 703–721.
Chauvey, J. N., Giordano-Spring, S., Cho, C. H., & Patten, D. M. (2015). The normativity and legitimacy of CSR disclosure: Evidence from France. Journal of Business Ethics, 130(4), 789–803.
Cho, C. H., & Patten, D. M. (2007). The role of environmental disclosures as tools of legitimacy: A research note. Accounting, Organizations and Society, 32, 639–647.
Cisi, M. (2003). Il bilancio ambientale. Torino: Giappichelli.
Clarksonm, P. M., Overell, M. B., & Chapple, L. (2011). Environmental reporting and its relation to corporate environmental performance. Abacus, 47, 27–60.
Daub, C. H. (2007). Assessing the quality of sustainability reporting: An alternative methodological approach. Journal of Cleaner Production, 15, 75–85.
DECRETO LEGISLATIVO 30 dicembre 2016, n. 254 Attuazione della direttiva 2014/95/UE del Parlamento europeo e del Consiglio del 22 ottobre 2014, recante modifica alla direttiva 2013/34/UE per quanto riguarda la comunicazione di informazioni di carattere non finanziario e di informazioni sulla diversita’ da parte di talune imprese e di taluni gruppi di grandi dimensioni. (17G00002) (GU Serie Generale n.7 del 10-01-2017), https://www.gazzettaufficiale.it/eli/id/2017/01/10/17G00002/sg.
del Mar Alonso-Almeida, M., Llach, J., & Marimon, F. (2014). A closer look at the ‘global reporting initiative’ sustainability reporting as a tool to implement environmental and social policies: A worldwide sector analysis. Corporate Social Responsibility and Environmental Management, 21, 318–335.
European Commission. (2014). Directive 2014/95/EU of the European Parliament and of the council of 22 October 2014 amending directive 2013/34/EU as regards disclosure of non-financial and diversity information by certain large undertakings and groups Text with EEA relevance, L 330. http://data.europa.eu/eli/dir/2014/95/oj. Retrieved October 5, 2019.
European Commission. (2017). Guidelines on non-financial reporting (Methodology for Reporting Non-Financial Information) (2017/C 215/01). European Commission: Brussels, Belgium. Available online: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52017XC0705(01)&from=GA. Retrieved May 10, 2019.
Fernandez-Feijoo, B., Romero, S., & Ruiz, S. (2014). Effect of stakeholders’ pressure on transparency of sustainability reports within the GRI framework. Journal of Business Ethics, 122, 53–63.
Gasperini, A., & Zambon, S. (2017). Confronto a due sulle non financial information. Impresa Progetto, 1, 1–10.
GRI. (2015a). G4 sustainability reporting guidelines. Reporting principles and standard disclosures. Retrieved from https://www.globalreporting.org/information/g4/Pages/defau lt.aspx.
GRI. (2015b). Sustainability reporting guidelines. Implementation manual. Retrieved from https://www.globalreporting.org/information/g4/Pages/default.aspx.
GRI. (2017). Measuring progress on the SDGs: A mapping of the SDG indicators and the GRI standards. Summary of results.
Hąbek, P., & Wolniak, R. (2016). Assessing the quality of corporate social responsibility reports: The case of reporting practices in selected European Union member states. Quality and Quantity, 50(1), 399–420.
Hussain, N. (2015). Impact of sustainability performance on financial performance: An empirical study of global fortune (N100) firms. Ca‘ Foscari University of Venice 1.
Jasch, C. (2000). Environmental performance evaluation and indicators. Journal of Cleaner Production, 8, 79–88.
Jasch, C. (2009). Environmental and material flow cost accounting. Dordrecht: Springer.
Khlif, H., Guidara, A., & Souissi, M. (2015). Corporate social and environmental disclosure and corporate performance: Evidence from South Africa and Morocco. Journal of Accounting and Emerging Economies, 5, 51–69.
KPMG. (2017). KPMG The road ahead. In The KPMG Survey of Corporate Responsibility Reporting 2017. Zurich: KPMG.
Krippendorff, K. (1980). Content analysis: An introduction to its methodology. Thousand Oaks: Sage Publications.
Laskar, N., & Gopal Maji, S. (2018). Disclosure of corporate sustainability performance and firm performance in Asia. Asian Review of Accounting, 26(4), 414–443.
Legendre, S., & Coderre, F. (2013). Determinants of GRI G3 application levels: The case of the fortune global 500. Business Strategy and the Environment, 20(3), 182–192.
Lin, H., Chang, O., & Chang, C. (2014). Importance of sustainability performance indicators as perceived by the users and preparers. Journal of Management Sustainability, 4(1), 29–41.
Lock, I., & Seele, P. (2016). The credibility of CSR (corporate social responsibility) reports in Europe. Evidence from a quantitative content analysis in 11 countries. Journal of Cleaner Production, 122, 186–200.
Loprevite, S., Ricca, B., & Rupo, D. (2018). Performance sustainability and integrated reporting: Empirical evidence from mandatory and voluntary adoption contexts. Sustainability, 10(5), 1351.
Luque-Vilchez, M., & Larrinaga, C. (2016). Reporting models do not translate well: Failing to regulate CSR reporting in Spain. Social and Environmental Accountability Journal, 36(1), 56–75.
Manes-Rossi, F., Tiron-Tudor, A., Nicolò, G., & Zanellato, G. (2018). Ensuring more sustainable reporting in Europe using non-financial disclosure-De Facto and De Jure evidence. Sustainability, 10(4), 1162.
Mio, C. (2005). Corporate social responsibility e sistema di controllo: verso l’integrazione (Vol. 354). Milano: FrancoAngeli.
Mio, C. (2010). Corporate social reporting in Italian multi-utility companies: An empirical analysis. Corporate Social Responsibility and Environmental Management, 17(5), 247–271.
Mio, C., & Venturelli, A. (2013). Non-financial information about sustainable development and environmental policy in the annual reports of listed companies: Evidence from Italy and the UK. Corporate Social Responsibility and Environmental Management, 20(6), 340–358.
Mion, G., & Loza Adaui, C. R. (2019). Mandatory nonfinancial disclosure and its consequences on the sustainability reporting quality of Italian and German companies. Sustainability, 11(17), 4612.
Olsthoorn, X., Tyteca, D., Wagner, M., & Wehrmeyer, W. (2001). Environmental indicators for business: A review of the literature and standardisation methods. Journal of Cleaner Production, 9, 453–463.
Prado-Lorenzo, J. M., Rodríguez-Domínguez, L., Gallego-Álvarez, I., & García-Sánchez, I. M. (2009). Factors influencing the disclosure of greenhouse gas emissions in companies world-wide. Management Decision, 47, 1133–1157.
Schaltegger, S., & Burritt, R. (2000). Contemporary environmental accounting. Sheffield: Greenleaf Publishing Limited.
Setia, N., Abhayawansa, S., Joshi, M., & Huynh, A. V. (2015). Integrated reporting in South Africa: Some initial evidence. Sustainability Accounting, Management and Policy Journal, 6(3), 397–424.
Skouloudis, A., Evangelinos, K., & Kourmousis, F. (2009). Development of an evaluation methodology for triple bottom line reports using international standards on reporting. Environmental Management, 44, 298–311.
Tarquinio, L., Raucci, D., & Benedetti, R. (2018). An investigation of global reporting initiative performance indicators in corporate sustainability reports: Greek, Italian and Spanish evidence. Sustainability, 10(4), 897.
Toppinen, A., Li, N., Tuppura, A., & Xiong, Y. (2012). Corporate responsibility and strategic groups in the forest-based industry: Exploratory analysis based on the global reporting initiative (GRI) framework. Corporate Social Responsibility and Environmental Management, 19(4), 191–205.
United Nations, SDG Indicators, Global indicator framework for the Sustainable Development Goals and targets of the 2030 Agenda for Sustainable Development. Https://Unstats.Un.Org/Sdgs/Indicators/Indicators-List/. Retrieved on July 2018.
Venturelli, A., Caputo, F., Leopizzi, R., & Pizzi, S. (2017). Directive 2014/95/EU: Are Italian companies already compliant? Sustainability, 9(8), 1385.
Wilburn, K., & Wilburn, R. (2013). Using global reporting initiative indicators for CSR programs. Journal of Global Responsibility, 4(1), 62–75.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2020 Springer Nature Switzerland AG
About this chapter
Cite this chapter
Raucci, D., Tarquinio, L., Rupo, D., Loprevite, S. (2020). Non-financial Performance Indicators: The Power of Measures to Operationalize the Law. In: Mauerhofer, V., Rupo, D., Tarquinio, L. (eds) Sustainability and Law. Springer, Cham. https://doi.org/10.1007/978-3-030-42630-9_15
Download citation
DOI: https://doi.org/10.1007/978-3-030-42630-9_15
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-030-42629-3
Online ISBN: 978-3-030-42630-9
eBook Packages: Law and CriminologyLaw and Criminology (R0)