scholarly journals BP plc 2010 – a case of linguistic legitimation?

2017 ◽  
Vol 18 (4) ◽  
pp. 480-495 ◽  
Author(s):  
Gavin D’Northwood
Keyword(s):  
Annual Report ◽  
Corpus Analysis ◽  
Annual Reports ◽  
Content Type ◽  
Linguistic Evidence ◽  
Interdisciplinary Approaches ◽  
Register Analysis ◽  
Research Questions ◽  
Similarities And Differences ◽  
Corporate Disclosures

Purpose The purpose of this paper is to examine the statements by the chairman and CEO in BP plc’s Annual Report 2010 for linguistic evidence of reader positioning. This is based on the premise that reputational fallout from the Deepwater Horizon oil spill would have heightened the need for such positioning to repair the company’s legitimacy. Design/methodology/approach Applying Halliday’s systemic functional linguistics (SFL) framework, a comparative register analysis was undertaken of the respective statements of the chairman and CEO of BP plc. This was informed by corpus analysis of these statements, of comparative statements from industry competitors and of two larger-scale corpora constructed from the chairman and CEO statements extracted from the annual reports of 25 FTSE100 companies. Findings The findings suggest that readers’ perceptions are likely to be shaped by the statements of the chairman and CEO of BP plc in the company’s 2010 annual report, but similarities and differences are apparent in the way this positioning is engineered. Broader corpus analysis hints that these similarities and differences are not localised to BP plc. Research limitations/implications The analysis relies on the assumptions that the chairman and CEO are the writers of each piece. As with prior research, questions of intent on the part of the corporate authors and impact upon target readers remain unanswered. Practical implications This paper demonstrates and highlights the issue of reader positioning through lexico-grammatical choices in corporate disclosures. Originality/value This paper makes a contribution to the literature by demonstrating how reader positioning may be engineered through lexico-grammatical choices in corporate disclosures. This paper further responds to a call from Sydserff and Weetman (1999, 2002) for interdisciplinary approaches to investigating corporate narrative reports involving linguistics, through foregrounding Halliday’s SFL framework as an analytical tool.

scholarly journals Visual trends in the annual report: the case of Ericsson 1947-2016

2018 ◽  
Vol 23 (3) ◽  
pp. 312-325 ◽  
Author(s):  
Emelie Havemo
Keyword(s):  
Impression Management ◽  
Design Methodology ◽  
Annual Report ◽  
Annual Reports ◽  
Corporate Disclosure ◽  
Content Type ◽  
Visual Research ◽  
Visual Research Methods ◽  
Visual Elements ◽  
Reporting Practice

PurposeDisclosure research has argued that visuals are increasingly used in annual reports as a way to increase readability of the annual report, but comparatively little is known about of diagrams compared to graphs and photographs. The purpose of this paper is to provide a historical account of visuals use in corporate disclosure, with an emphasis on diagrams, to show changes from the 1940s until present-day reporting.Design/methodology/approachVisual research methods were applied to analyze how diagrams, photographs and graphs were used in 69 annual reports of the Swedish telecom company Ericsson.FindingsPhotographs have been used with increasing frequency since the 1950s. Graph and diagram use has increased significantly since the 1990s while photograph use remained stable, suggesting that graphs and diagrams increasingly complement photographs for visually representing the organization in corporate disclosure. Factors explaining the case company’s development include both internal (performance, individual preferences, shifting from a manufacturing-based strategy to a service-based strategy) and external (legislation, transformation of the telecom industry).Originality/valueVisual elements in annual reports are increasingly oriented toward immaterial representations of the organization’s standings and identity and diagrams are increasingly used and contribute to this. This finding motivates further research about diagram use in corporate communication, such as how different diagram types convey accounting messages, and whether diagrams serve as impression management devices. For regulators, it will be important to follow the emerging trend of diagram use, since it is becoming part of reporting practice.

Non-financial KPIs in annual report narratives: Australian practice

2019 ◽  
Vol 32 (1) ◽  
pp. 7-19 ◽  
Author(s):  
Lyndie Bayne ◽  
Marvin Wee
Keyword(s):  
Voluntary Disclosure ◽  
Annual Report ◽  
Performance Indicator ◽  
Preliminary Evidence ◽  
Annual Reports ◽  
Accounting Standard ◽  
Content Type ◽  
Financial Measures ◽  
Reporting Practices ◽  
Common Category

Purpose The purpose of this paper is to provide preliminary evidence on current practices in non-financial key performance indicator (KPI) reporting in annual reports by listed Australian companies to inform Australian legislators and accounting standard setters contemplating regulations and guidance for non-financial performance disclosure, including input into the revision of IFRS Practice Statement 1: Management Commentary (2010). Design/methodology/approach Non-financial KPIs were hand-collected from the annual report narratives of 40 listed Australian companies from five sectors in 2016. Trends in the type, quantity, comparability and range of non-financial KPIs were analysed, and the association between company characteristics and non-financial disclosure was explored. Findings In total, 78 per cent of the sampled companies disclose non-financial KPIs in their annual reports, reporting 11 non-financial KPIs per company on average. The most common category is Employee, followed by Environment, accounting for 68 per cent of non-financial KPIs. Provision of comparators is low, with only 28 per cent of non-financial KPIs disclosed with prior year results and 24 per cent disclosed with a target. Companies disclose across a median of two out of seven categories. Company size is shown to be associated with non-financial measures. Originality/value The study contributes initial detailed empirical Australian evidence of non-financial KPI reporting practices. A framework is established for assessing non-financial KPI disclosure, adding to voluntary disclosure studies. A data collection method is developed for collecting KPIs from annual report narratives, contributing to the methodology used in voluntary reporting content analysis.

scholarly journals CSR disclosure in response to major airline accidents: a legitimacy-based exploration

2016 ◽  
Vol 7 (1) ◽  
pp. 26-43 ◽  
Author(s):  
Petros Vourvachis ◽  
Thérèse Woodward ◽  
David G. Woodward ◽  
Dennis M Patten
Keyword(s):  
Annual Report ◽  
Annual Reports ◽  
Corporate Disclosure ◽  
Content Type ◽  
Social Legitimacy ◽  
Airline Accidents ◽  
Major Airlines ◽  
Csr Disclosure ◽  
Corporate Social ◽  
Practical Implications

Purpose – The purpose of this paper is to contribute to the literature investigating disclosure reactions to legitimacy threats by analyzing the corporate social responsibility (CSR) disclosure reactions to catastrophic accidents suffered by major airlines. Design/methodology/approach – The authors use content analysis to examine changes in annual report disclosure in response to four separate airline disasters. The authors adopt two classification schemes and two measurement approaches to explore these changes. Findings – The authors find that for three events the organizations appear to have responded with considerable increases in CSR disclosure that are consistent with attempts of legitimation. For one of the events examined, the authors find no disclosure response and suggest that this could be due to the company’s unwillingness to accept responsibility. Research limitations/implications – The study’s focus on major airlines that have suffered an accident with available annual reports in English meant that other companies had to be excluded from the analysis. Practical implications – The findings demonstrate the use of the annual report as a legitimation tool and further highlight the need for greater transparency and comparability across publications. Originality/value – The paper adds to the scarce literature examining corporate disclosure reactions following threats to their social legitimacy.

Does annual report readability explain the accrual anomaly?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ming Liu ◽  
Zhefeng Liu
Keyword(s):  
Market Efficiency ◽  
Annual Report ◽  
Efficient Market Hypothesis ◽  
Annual Reports ◽  
Accrual Anomaly ◽  
Efficient Market ◽  
Content Type ◽  
Market Friction ◽  
Unbiased Manner ◽  
Red Flag

PurposeThe purpose of the study is to investigate the possible role of annual report readability in accrual anomaly, shedding light on why investors fail to incorporate accruals information in a timely and unbiased manner beyond the original naive investor fixation explanation.Design/methodology/approachUsing five proxies of annual report readability and available data over 1993–2017, we investigate whether accrual overpricing is more severe when annual reports are less readable.FindingsWe find little (substantive) evidence of accrual overpricing among high (low) readability firms. The readability effects are contingent on the level of business complexity and earnings management.Research limitations/implicationsThis study extends the original naive investor fixation explanation and documents annual report complexity as a market friction in explaining the accrual anomaly, contributing to the mispricing vs risk debate and supporting the efficient market hypothesis.Practical implicationsLow readability of annual reports is a red flag to investors.Social implicationsThis study provides support for regulatory initiatives aimed at enhancing readability of corporate disclosures to address market frictions and improve market efficiency.Originality/valueAccrual anomaly has posed a challenge to the efficient market hypothesis. This study draws on and adds to the line of research indicating that annual report complexity is a friction erecting a barrier to transparency, hindering market efficiency. This study contributes to our understanding of the enigmatic accrual anomaly.

scholarly journals Intellectual capital reporting, leadership and strategic change

2016 ◽  
Vol 17 (1) ◽  
pp. 61-83 ◽  
Author(s):  
Richard Slack ◽  
Matthias Munz
Keyword(s):  
Intellectual Capital ◽  
Value Creation ◽  
Corporate Strategy ◽  
Annual Report ◽  
Strategic Change ◽  
Annual Reports ◽  
Future Research ◽  
Integrated Reporting ◽  
Leadership Change ◽  
Content Type

Purpose – A change in leadership can signal a shift in corporate strategy to drive future value creation. To help achieve this, a different emphasis may be placed upon the intellectual capital (IC) resources within the organisation. The purpose of this paper is to examine the changes in volume, composition and emphasis of IC disclosure in annual reports mapped against the re-orientation of corporate strategy and associated leadership change. Design/methodology/approach – A longitudinal period of over three decades (1979-2010) is examined. Adopting a case-based approach, Daimler AG is purposively selected for this research having a number of distinct changes in strategy over the period, reflective of leadership change. Using content analysis, annual report IC-related disclosures (structural, relational and human capital) by Daimler AG are examined, by category and more detailed sub-categories, against corporate strategy. Findings – The composition and emphasis of IC disclosures found in the annual reports changes over the longitudinal period and is reflective of the prevailing corporate strategy at that time. There were four identified periods of strategy, each associated with leadership change. The prevalence and qualitative focus of IC disclosures relevant to each period reflects the importance of respective IC components in corporate value creation. Research limitations/implications – The research is based on annual report IC disclosures within one case company and hence reflect the messages conveyed by that company over the longitudinal period. Additionally, the authors recognise that the annual report is only one source of corporate information, but as a historic record it serves to consistently capture management disclosure over a long-time period. Future research, adopting an econometric approach, could further test the linkages between leadership change, strategic shift and IC-related disclosure. Practical implications – The research reveals how IC-related disclosure shifts to reflect leadership and strategic change within a case company. Through such disclosure, the authors are able to gain greater insight into how a specific business seeks to create value drawing on the components of IC underpinning corporate strategy. Originality/value – The research provides new insights into IC disclosure by mapping its content and emphasis against changes in corporate strategy. This has contemporary significance due to the wider disclosure debate concerning strategy and value creation in the annual report, for instance through integrated reporting. Further, the research shows the value of annual reports for longitudinal disclosure research.

scholarly journals Company responses to demands for annual report changes

2018 ◽  
Vol 31 (6) ◽  
pp. 1593-1617 ◽  
Author(s):  
Thomas Riise Johansen ◽  
Thomas Plenborg
Keyword(s):  
Annual Report ◽  
Audit Committees ◽  
Annual Reports ◽  
Preparation Process ◽  
Regulatory Enforcement ◽  
Content Type ◽  
Barriers To Change ◽  
New Ideas ◽  
The Uk ◽  
User Orientation

Purpose The purpose of this paper is to examine how and the extent to which barriers to change inhibit new ideas about note disclosures to manifest themselves in annual reports. Design/methodology/approach The study employs regulation theory and draws on case studies in Denmark and the UK to understand compliance motivations and, on that basis, to identify the barriers to and enablers of changes to note disclosures in annual reports. Findings It is demonstrated how certain characteristics of the annual report preparation process can dampen the potential for change. It is also shown how preparer perceptions of oversight agents (auditors, enforcers, audit committees) have effects on disclosure behaviour. These characteristics appear to cause defensiveness among the actors involved in the process, inhibiting changes. In contrast, enablers are related to trust in regulatory enforcement, facilitation from enforcers, user orientation and shared understanding among functional groups involved in the preparation process. Practical implications The preparation of notes is susceptible to the influence of a range of factors, such as company politics, perceptions of enforcement styles and actors’ concerns about being blamed for inappropriate responses to regulation. These findings could be considered by regulators, auditors and preparers in enhancing understanding of their respective roles in the annual report preparation process. Originality/value This study illuminates the conditions that facilitate change when new ideas are introduced to a highly normative and detailed field. The study contributes to previous research by providing a fieldwork-based analysis of the practices, judgements, discussions and actors involved in the preparation of note disclosures.

Developing a reporting and evaluation framework for biodiversity

2014 ◽  
Vol 27 (3) ◽  
pp. 527-562 ◽  
Author(s):  
Grant Samkin ◽  
Annika Schneider ◽  
Dannielle Tappin
Keyword(s):  
Design Methodology ◽  
Annual Report ◽  
Assessment Tool ◽  
Evaluation Framework ◽  
Ecological Perspective ◽  
Annual Reports ◽  
Ecological Approach ◽  
Content Type ◽  
Related Text ◽  
Over Time

Purpose – The purpose of this paper is to illustrate the development of a biodiversity reporting and evaluation framework. The application of the framework to an exemplar organisation identifies biodiversity-related annual report disclosures and analyses changes in the nature and levels of these over time. Finally, the paper aims to establish whether the disclosures made by the exemplar are consistent with a deep ecological perspective, as exemplified by New Zealand conservation legislation. Design/methodology/approach – Viewing the framework developed by the paper through a deep ecological lens, the study involves a detailed content analysis of the biodiversity disclosures contained within the annual reports of a conservation organisation over a 23-year period. Using the framework developed in this paper, the biodiversity-related text units were identified and allocated to one of three major categories, 13 subcategories, and then into deep, intermediate and shallow ecology. Findings – Biodiversity disclosures enable stakeholders to determine the goals, assess their implementation, and evaluate the performance of an organisation. Applying the framework to the exemplar revealed the majority of annual report disclosures focused on presenting performance/implementation information. The study also found that the majority of disclosures reflect a deep ecological approach. A deep/shallow ecological tension was apparent in a number of disclosures, especially those relating to the exploitation of the conservation estate. Originality/value – This paper is the first to develop a framework that can be used as both a biodiversity reporting assessment tool and a reporting guide. The framework will be particularly useful for those studying reporting by conservation departments and stakeholders of organisations whose operations impact biodiversity.

Implications of Shariah on the voluntary disclosure of Indonesian listed companies

2014 ◽  
Vol 12 (1) ◽  
pp. 76-98 ◽  
Author(s):  
Peni Nugraheni ◽  
Hairul Azlan Anuar
Keyword(s):  
Voluntary Disclosure ◽  
Annual Report ◽  
Quality Measurement ◽  
Annual Reports ◽  
Company Size ◽  
Religious Activities ◽  
Content Type ◽  
Significant Difference ◽  
The Relationship

Purpose – The purpose of this paper is to investigate and compare the extent of voluntary disclosure in the annual reports of Shariah- and non–Shariah-compliant companies in Indonesia. Further, the study examines the relationship between voluntary disclosure and company characteristics (i.e. size of company, profitability, type of auditor, type of industry and ownership structure). Design/methodology/approach – Voluntary disclosure was measured using a disclosure index with 30 items and content analysis of the 2009 annual report. Statistical analysis included descriptive, Mann–Whitney U and regression. Findings – The result revealed that there is a statistically significant difference in the quantity and quality of voluntary disclosure value of Shariah- and non–Shariah-compliant companies. For regression results, the company size significantly influences the quantity of voluntary disclosure while the quality of voluntary disclosure is affected by company size and type of industry. Research limitations/implications – Although this study only analyses voluntary disclosure in the annual report for a single year (2009), it is hoped to provide a description of the voluntary disclosure in Shariah- and non–Shariah-compliant companies. Practical implications – The findings might be used by regulators to set regulations that encourage the quantity and quality of disclosure practice of Shariah-compliant companies to expand the scope of disclosure related to religious activities. Originality/value – This study measures voluntary disclosure using the disclosure index based on Indonesian regulations and the quantity and quality measurement of Shariah-compliant companies, which may differ from previous Indonesian studies.

Culture and annual report readability

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Minyoung Noh
Keyword(s):  
Design Methodology ◽  
Annual Report ◽  
State Level ◽  
The State ◽  
Annual Reports ◽  
Litigation Risk ◽  
Content Type ◽  
State Culture ◽  
The Usa ◽  
Positive Effect

Purpose This study aims to examine the effect of state culture on the readability of narrative disclosures in annual reports based on firms located in all 50 states of the USA. Design/methodology/approach The author uses the cultural tightness and looseness (Harrington and Gelfand 2014) index at the state level and the BOG index (Bonsall and Miller, 2017) as the primary measures of annual report readability. Findings Using US data from 1994 to 2019, this study finds that the state level of cultural tightness in which firms are located positively affects firms’ annual report readability. In addition, the study finds that the positive effect of cultural tightness on annual report readability is pronounced in subgroups with high litigation risk while the result does not hold with subgroups that have low litigation risk. The results are robust when alternative proxies for annual report readability are used and historical location and the states in which firms are incorporated are considered. Originality/value This study contributes to the growing literature on the determinants of readability in annual report because firms’ narrative disclosure in annual report varies depending on the information environment, litigation risk, embedded in each state culture where firms are located.

Voluntary disclosure and complexity of reporting in Egypt: the roles of profitability and earnings management

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mai Mohammed Alm El-Din ◽  
Atef Mohammed El-Awam ◽  
Farid Moharram Ibrahim ◽  
Ahmed Hassanein
Keyword(s):  
Earnings Management ◽  
Voluntary Disclosure ◽  
Management Practices ◽  
Annual Report ◽  
Management Practice ◽  
Poor Performance ◽  
Annual Reports ◽  
Content Type ◽  
Nonfinancial Firms ◽  
The Relationship

PurposeThe study explores the relationship between information overloading and the complexity of reporting. In particular, it investigates whether voluntary information in a firm annual report is associated with its readability. Likewise, it examines how a firm's profitability and earnings management practices impact the nexus of voluntary disclosure and readability.Design/methodology/approachIt uses the annual reports of the Egyptian nonfinancial firms listed in the EGX 100 index from 2010 to 2018. The readability of the annual report is measured automatically using the LIX index, and a predeveloped voluntary disclosure index is used to measure the level of voluntary disclosure in the annual reports.FindingsThe results reveal that the readability of annual reports is a negative function of voluntary disclosure, suggesting that Egyptian firms with more voluntary disclosure are likely to have more complex (i.e. less readable) annual reports. Likewise, less profitable firms and firms with earning management practices increase voluntary information in their annual reports, resulting in an adverse impact on their reporting readability.Research limitations/implicationsIt focuses only on the annual reports of Egyptian firms and considers a firm’s overall voluntary information rather than a particular area of voluntary disclosure. It introduces a code to measure the readability of Arabic-written texts, which can be applied to different areas of disclosure.Practical implicationsPolicymakers in Egypt are encouraged to develop enforceable regulations to control voluntary disclosure in annual reports. Egyptian investors should view the practice of higher voluntary disclosure skeptically as its aim may be to divert attention from a firm's poor performance and earnings management practice.Originality/valueThe study is the first evidence from Egypt on the effect of information overloading, proxied by voluntary disclosure, on the readability of reporting. Likewise, it contributes to methodological development in measuring the readability of Arabic-written annual reports.

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