Equity

• Do investors value mandatory sustainability reporting standards?

  The European Union’s sustainability reporting reforms are often presented as a trade-off. On one side are the expected benefits of more complete, reliable and comparable corporate information. On the other are the costs imposed on companies required to collect, verify and disclose large volumes of sustainability data. At the same time, sustainability reporting serves a broader set of stakeholders than financial reporting, and the standard-setting process can therefore embed societal objectives that do not necessarily coincide with equity investors’ information needs.
  Recent debates surrounding the Corporate Sustainability Reporting Directive, or CSRD, and the European Sustainability Reporting Standards, or ESRS, have placed particular emphasis on the cost side of this trade-off. Policymakers have proposed narrowing the scope of the regulation, delaying implementation and simplifying reporting requirements in order to reduce compliance burdens.

  But how do investors perceive these reforms?
  In our recent study published in European Accounting Review, we examine stock market reactions to key events associated with the development and adoption of the ESRS. Unlike the earlier Non-Financial Reporting Directive, they introduce a common and detailed reporting framework covering environmental, social and governance issues. They also embed the principle of double materiality, requiring companies to report both how sustainability issues affect the firm and how the firm affects society and the environment.

  Investors reacted positively on average
  Across the four events, the average three-day cumulative abnormal return was 0.301%, equivalent to about EUR 17.8 million in market value for the average firm. This finding contrasts with some earlier evidence on broader non-financial disclosure mandates, where investors often reacted negatively. One possible explanation is that the ESRS do more than require additional disclosure: they introduce common standards that can make sustainability information easier to interpret and compare. But the average reaction is only part of the story.

  The benefits are not distributed equally
  We find stronger positive reactions for companies with lower-quality sustainability disclosure before the adoption of the standards. This is consistent with investors expecting greater improvements among firms whose previous reporting practices were relatively weak. We also find stronger reactions where existing sustainability reporting practices were more divergent, suggesting that investors anticipate greater benefits from standardisation when firms previously reported similar issues in inconsistent ways. Taken together, these findings suggest that mandatory sustainability reporting standards may be particularly valuable where voluntary reporting has been least effective.

  Who gains—and who does not?
  The market response was less positive for firms with poor environmental performance, consistent with investors anticipating greater reputational, operational or compliance costs as sustainability performance becomes more visible. By contrast, firms with stronger sustainability governance – including board-level sustainability committees and sustainability-linked managerial incentives – experienced more positive reactions, suggesting that investors viewes them to be better equipped to implement the new standards. Reactions were also weaker when firms’ sustainability disclosure appeared strong relative to their underlying environmental performance, consistent with greater perceived exposure to disclosure–performance gaps.

  What does this mean for the current simplification debate?
  The European policy debate has increasingly focused on reducing reporting complexity and administrative burdens. Some simplification may be justified, particularly where requirements generate costs without producing useful information.
  Our additional analyses suggest a note of caution. We examine events associated with the weakening or delayed application of the ESRS and find negative market reactions. Although these analyses should be interpreted cautiously, they are consistent with investors viewing reduced regulatory stringency as lowering the expected benefits of the reporting regime.
  This does not mean that every reporting requirement should be preserved. Nor does it imply that the ESRS will necessarily generate long-term benefits in practice. Our event-study design captures investor expectations around regulatory events, rather than the realised effects of the standards after several years of implementation. Reducing unnecessary compliance costs may benefit companies and investors. But weakening the features that improve information quality and comparability may remove precisely the benefits that investors appear to value.

  The broader lesson
  The broader lesson extends beyond the ESRS. Mandatory sustainability reporting may create capital-market benefits when it addresses weaknesses in voluntary reporting: incomplete information, inconsistent measurement and limited comparability across firms.
  The key question is therefore not simply whether sustainability reporting should be mandatory or voluntary, but how reporting standards should be designed. For policymakers, the challenge is to distinguish requirements that create unnecessary costs from those that make sustainability information more informative and comparable for capital markets.

   

• Interfirm cooperation and capital market performance: automated textual analysis of voluntary disclosures in Form 10-Ks

  In today’s business environment, firms are increasingly struggling to navigate through volatility and uncertainty. Therefore, successful cooperation across corporate and even industry boundaries is becoming highly important. In this context, interfirm cooperation (IFC) refers to an informal, non-equity-based arrangement typically formed by a small and limited number of independent firms pursuing individual, compatible, or concurrent, joint goals. A recent example of this is the partnership between heavy equipment manufacturer Caterpillar and technology firm Nvidia, which aims to accelerate the integration of AI in heavy machinery and manufacturing in order to drive industrial innovation. Similarly, conglomerate 3M has partnered with technology firm Microsoft, combining advanced materials science with digital resources and capabilities to enhance data centre infrastructure and enterprise transformation. In these and many other cases, the partners gain access to each other’s resources, capabilities, and expertise. This enables them to strengthen their competitive position and thus secure their long-term viability. Despite their high strategic relevance, however, IFCs are not yet subject to mandatory disclosure requirements. Consequently, partnering firms may voluntarily disclose IFC-related information to reduce information asymmetries between managers and investors, which can eventually improve their capital market performance.

  Against this background, the study ‘Interfirm cooperation and capital market performance: automated textual analysis of voluntary disclosures in Form 10-Ks’ examines how the extent of voluntary IFC-related disclosures relates to various capital market performance indicators of U.S.-listed firms. Drawing on signalling theory, the authors propose a non-linear relationship: While increasing disclosure levels may initially enhance capital market performance by reducing information asymmetries, higher levels could raise concerns about proprietary costs and information overload, ultimately triggering detrimental effects. To test this assumption, the study focuses on Form 10-K filings of 208 firms listed in the Standard & Poor’s (S&P) 500 stock market index between 2008 and 2020. Using a rule‑based approach of automated textual analysis supported by a newly developed dictionary, the authors construct a novel, text‑based measure of voluntary IFC-related disclosures. Subsequent multivariate analyses applying this new measure confirm the proposed non-linear pattern. More specifically, the results reveal U-shaped associations for market value and trading volume, as well as U-shaped associations for the cost of equity capital and the bid-ask spread. These findings remain consistent across multiple robustness checks and sample splits.

  Overall, this study highlights the value relevance of voluntary IFC-related disclosures and their importance for investor decision-making. Contrary to previous findings, it contributes to the accounting literature by unveiling the non-linear effects of these disclosures. In terms of corporate practice, the study shows how a balanced IFC-related disclosure strategy can help to improve firms’ capital market performance compared to low or excessive disclosure levels.

  Reference:

  Zink, D., Fischer, T. M., & Gaschler, S. (2026). Interfirm cooperation and capital market performance: automated textual analysis of voluntary disclosures in Form 10-Ks. European Accounting Review, 1–30. https://doi.org/10.1080/09638180.2026.2695138

• Sophisticated information systems and controller involvement in strategy development

  In this paper published in the European Accounting Review, we investigate whether the sophistication of management accounting information systems (MAIS) enhances controllers’ involvement in strategy development. Prior research offers inconclusive and largely qualitative evidence on this relationship: while some studies suggest that more advanced systems enable a stronger strategic role for controllers, others report limited or no such effect. Against this mixed empirical backdrop, we develop and test a role-theoretical model that links MAIS sophistication to controllers’ strategic participation and examine whether this relationship differs in family firms.

  We argue that more sophisticated MAIS should enable controllers to contribute more meaningfully to strategic decision-making by providing higher-quality and more integrated information. However, we expect family control to attenuate this relationship because strategic authority in such firms often remains concentrated within the owning family.

  Using survey data from German Mittelstand firms, we find a positive association between MAIS sophistication and controllers’ involvement in strategy development. Additional analyses indicate that this effect is primarily driven by improvements in information quality and analytical support rather than by time savings from automation. We also unpack the moderating role of family control and show that it weakens—but does not eliminate—the positive MAIS–strategy involvement relationship.

  Overall, we contribute to the management accounting and family business literatures by providing large-sample quantitative evidence that MAIS sophistication is an important enabler of controllers’ strategic role, while also demonstrating that ownership structures shape the extent to which this potential is realized.

  Reference:

  Hiebl, M. R. W., Thaller, J., Dohmen, C. J., & Papiorek, K. L. (2026). Management accounting information systems sophistication, family control, and controller involvement in strategy development. European Accounting Review, 1–35. https://doi.org/10.1080/09638180.2026.2619581

• The Last Signal Wins: What Professional Tennis Can Teach Us about Performance Feedback

  Why the Latest Performance Signal Matters

  Consider two employees with similar overall performance. One initially performs below colleagues but subsequently improves and receives positive recent performance information. The other starts strongly but receives negative information about their latest results. Although their cumulative performance may be comparable, is their subsequent performance likely to be the same?

  In our forthcoming article in European Accounting Review, we examine how individuals perform after receiving contradictory performance signals. Drawing on recency theory, we predict that subsequent performance is more strongly associated with the latest signal. We test this prediction using more than 29,000 professional tennis matches in which players receive opposing performance signals before a deciding set. This setting allows us to observe individuals in the same overall position but arriving there after either a recent success or setback.

  We find that a recent positive signal is associated with better subsequent performance than a recent negative signal. However, this relationship varies with the signal’s informativeness and the recipient’s characteristics. The recency relationship is weaker among individuals with characteristics associated with higher self-efficacy. We also document different patterns among men and women. Women tend to underperform following unexpected positive signals, consistent with choking under pressure, whereas men perform worse following recent setbacks, consistent with the Golem effect.

  These findings have implications for performance-information systems. Managers should consider not only the information provided but also its sequence, timing and informativeness. The most recent signal may have a particularly strong association with employees’ motivation and subsequent performance. Moreover, these relationships are unlikely to be uniform across employees. Understanding differences in confidence, experience and responses to pressure may therefore be important when interpreting the relationship between performance information and subsequent performance.

  Reference:

  Aranda, C., Arellano, J., & Dávila, A. (2026) The last signal wins: How recent performance information shapes subsequent performance under contradictory signals. Forthcoming in European Accounting Review.

• Can Management Control Impact Sustainable Behavior?

  From prior research, we know that management control can impact employee motivation and behavior. In our new study, recently published in Public Administration Review, we find that sustainability-related management controls can stimulate pro-environmental behavior of employees. Below, we highlight our main findings.

  Pro-environmental behavior and management control

  While CO₂ levels are reaching record high levels, the scientific consensus is that it is “unequivocal that human influence has warmed the atmosphere, ocean and land” (IPCC 2023). We are interested in studying how the impact of human beings and organizations on climate can be prevented or mitigated, which is why we examine pro-environmental behavior in organizations.

  Survey evidence was collected in a Dutch city government that is at the forefront of implementing sustainability-related forms of management control. We categorized their management control efforts in output control (e.g., a sustainability budget and a coalition agreement on sustainability goals), behavior control (e.g., a sustainability roadmap and compulsory sustainability formats for new proposals), and clan control (e.g., statements from senior management, training, and inspiration sessions).

  Finding 1: Climate-concerned employees engage in more sustainable behavior

  First, we find that employees who are more concerned about the climate, also engage more in pro-environmental behavior in the workplace (H1). This is in line with the theory of planned behavior, which states that actual behavior often correlates with intentions.

   

  Finding 2: Output controls strengthen the relation between concern and behavior

  Second, our findings suggest that the familiarity of employees with sustainability-related output controls strengthens the relation between employee concerns about the climate and their pro-environmental behavior (H4). We theorize this by arguing that budgets can signal a norm, and stronger social norms can strengthen the likelihood that employees translate their environmental concerns into action.

  Finding 3: Behavior controls directly increase sustainable behavior

  Third, our survey evidence suggests that behavior controls, such as formats that force employees to write about the climate impact of their proposals, directly impact pro-environmental behavior (H3). This finding is independent from the level of employee concerns about the climate. In other words, if employees have lower levels of concern for the environment, behavior controls can still be effective to increase their pro-environmental behavior.

  Conclusion

  Research in the field of management control and sustainability is still in development. We contribute to this literature by unpacking how different types of management control can help facilitate pro-environmental behavior. Have a look at our paper (open access) in Public Administration Review for more information about this study, its limitations, and its implications.

   

  Full paper (open access)

  Van der Kolk, B., Wiersma, E., Odekerken, W. (2026). Stimulating Pro-Environmental Behavior Using Management Control. Public Administration Review, forthcoming. https://doi.org/10.1111/puar.70156

   

  Biographies

  Berend van der Kolk is an Associate Professor of Management Accounting at VU Amsterdam.
  Eelke Wiersma is an Associate Professor of Management Accounting at VU Amsterdam.
  Willemijn Odekerken is a Senior Controller at a Dutch City Government.

   

• Call for Papers: Special Issue in International Journal of Auditing, “Audits Beyond Public Companies”

   The idea behind this special issue is to broaden the focus of auditing research to include audit practices outside the typical public company context. 

  So far, audit research has mainly focused on auditors and audit practices related to public companies. However, the majority of audit engagements actually involve non-listed clients. Looking at how the audit market is shaped in practice means looking at the auditors who work with these clients. 

  From the client perspective, and building on the review by Vanstraelen and Schelleman (2017), “Auditing Private Companies: What Do We Know?”, we invite submissions that address gaps in our understanding of private company audits. While prior research confirms that audits can enhance financial reporting quality, important questions remain about the context-specific value of audits, the design of audit regulation for private firms, and the viability of alternative assurance services. 

  From the auditor perspective, we aim to expand our knowledge of auditors and their relationships with all types of clients, not only listed companies. This means paying more attention to smaller audit firms and individual auditors. Despite increasing interest in audit inputs, we still know relatively little about how individual auditors and audit teams (their experience, judgment, interpersonal dynamics, and allocation of resources) shape audit outcomes. Research exploring the interactions) between publicly listed and private companies in the audit context is also of interest for this special issue. 

  Moreover, in private firm contexts, the nature of the auditor-client relationship is often more multifaceted. Clients typically rely on auditors not only for the assurance of their financial statements but also for a broader range of services, including support on internal control systems, accounting treatments, tax planning, and, more recently, sustainability reporting. This blurs the line between audit and advisory work, especially in smaller engagements where the same individual or closely connected team may provide multiple services to the same client. This dynamic raise important questions about independence, role conflict, and how multidisciplinary expertise is coordinated across different service lines within auditor’s work. 

  We welcome contributions from a broad spectrum of theoretical perspectives and research methodologies. Submissions may include empirical studies (whether qualitative, quantitative, archival, experimental, or mixed methods) as well as purely theoretical or conceptual papers. We especially encourage work that offers novel insights, challenges prevailing assumptions, or explores emerging issues from diverse scholarly approaches. 

  Submissions are reviewed on a rolling basis as they are received and remain open through October 31, 2026. 

  Guest editors: 

  Ann Vanstraelen (Maastricht University), Pietro A. Bianchi (Bocconi University), Like Jiang (University of Melbourne) and Miguel Minutti-Meza (University of Miami). 

  Online access and submission details:

  International Journal of Auditing

  Special Issue in International Journal of Auditing 2026 (with QR code for online access and submission details)

• Extended Deadline for the 10th Workshop on Accounting and Regulation (Siena – June 25-27, 2026)

  New Deadline for applications: 24^th April 2026 (to be submitted by email to dipietra@unisi.it)

  The 10th Workshop on Accounting & Regulation will take place in the Rectorate building of the University of Siena (Via Banchi di Sotto, no. 55, Siena) and the “Santa Chiara Lab” (Via Valdimontone nº 5, Siena) from June 25^th to June 27^th, 2026.

  The submission of papers addressing Accounting & Regulation topics is welcome and should be done by email to dipietra@unisi.it (rather than through the EIASM system).

  Note: papers submitted before March 20th through the EIASM system should not be resubmitted unless there are paper updates,  which must be sent to dipietra@unisi.it.

  More information can be found here:

  10th Workshop on Accounting and Regulation – ARC

  ORGANISING CONTACT IN SIENA: Roberto Di Pietra, University of Siena (previously co-organized with EIASM)

  STEERING COMMITTEE Roberto Di Pietra (University of Siena); Luzi Hail (University of Pennsylvania); Jörg-Markus Hitz (University of Tübingen); Araceli Mora (University of Valencia); Carien van Mourik (Open University); Ivana Raonic (Bayes Business School); Alfred Wagenhofer (University of Graz)

  ORGANISING COMMITTEE Jonida Carungu, London Metropolitan University; Matteo Molinari, University of Bergamo

• Upcoming Application Deadline for the EAA Annual Congress Host Programme

  Deadline for Application is April 15th 2026

  Following the successful launch of the EAA Annual Congress Host Programme at the 2025 congress in Rome, the EAA Diversity, Equity, and Inclusion Committee (DEIC) is delighted to continue the initiative at the 2026 Annual Congress in Prague. Building on the positive feedback from participants in Rome, the programme aims to make the congress experience more welcoming, accessible, productive and engaging for first-time attendees.

  What is the Host Programme?

  Due to the size of the congress, it can sometimes be challenging for new members to connect with colleagues and navigate the programme. The Host Programme pairs first‑time attendees with experienced EAA members who help them navigate the congress, connect with colleagues to expand their network, and engage more fully with the academic accounting community.

  The main idea is that EAA Hosts will initiate contact with Attendees by email before the congress and arrange to meet at the venue. A welcoming space with drinks and refreshments will be reserved on Wednesday 27 May from 12:00–13:00 for participants to meet before the Congress’ Opening Session. Hosts and Attendees are also encouraged to connect throughout the congress, including at parallel sessions, symposia, and social events. EAA DEIC members will be available to answer questions, at the EAA Host programme hangout corner where host/attendees can meet throughout the congress.

  Using the EAA Annual Congress Programme, Hosts may also suggest sessions and activities that Attendees might find valuable. The goal is for Hosts to share their knowledge and experience so that Attendees can make the most of their first EAA Annual Congress. Hosts are also encouraged to introduce Attendees to other colleagues, helping early career researchers and those new to the EAA community build their own professional networks. Ideally, Hosts will attend their Attendees’ presentations and, after the congress, offer to stay in touch.

  This year we are introducing a drinks event on the last day of the congress for everyone involved in the Host Programme. This will take place on Friday 29^th May at 15:30–16:30, immediately after the DEIC Symposium 9, to thank Hosts and give participants another opportunity to connect.

   Interested in being a Host?

  If you have attended at least two EAA Annual Congresses and would like to support a new attendee, please complete the Host application form.

   Are you a first-time Attendee at the 2026 EAA Annual Congress in Prague?

  If you would appreciate guidance and conversation from an experienced EAA member, please complete the Attendee application form

  Please submit your application no later than April 15^th at 11:59 pm CET.

   Please contact us if you have any questions about the EAA DEIC Host Programme

   

  FAQs

  How many Attendees will be assigned to each Host?
  Each Host will be matched with 2-3 Attendees. The DEIC will match new members with volunteer Hosts on a first-come, first-served basis, so please register early.

  How are Hosts matched with Attendees?
  We aim to match Attendees with Hosts who have similar teaching or research areas. We will also consider arrival times, so please make sure to provide any relevant details to help with matching.

  How will I receive contact information?
  We will notify you once the matching process has been completed. The DEIC will email both Hosts and Attendees with names and contact information.

  Who qualifies as an Attendee?
  Anyone attending their first EAA Annual Congress.

  Missed connections?
  Even with the best intentions, plans can sometimes go awry. If you are having trouble connecting at the congress, please visit the EAA Host Programme hangout corner. There will be a QR code that you can scan and start exchanging messages with Host or Attendee.

  What are the Hosts expected to do?

  Hosts are encouraged to:

  • Contact Attendees before the congress
  • Meet during the Wednesday afternoon Host programme welcome meeting
  • Introduce Attendees to colleagues
  • Suggest relevant sessions
  • Attend the Attendee’s presentation where possible

  What are the Attendees expected to do?

  Attendees are encouraged to:

  • Respond to Host initial contact
  • Meet during the Wednesday afternoon Host programme welcome meeting
  • Share any specific enquiry of interest with Host
  • Invite the Hosts to their presentation where possible
  • Attend the Friday EAA Host Programme thank you meeting

• EAA Education Survey 2025

  Brief description

  The EAA Education Committee recently conducted a survey to gather members’ perspectives of accounting education. We received a total of 90 responses, primarily from tenured faculty members with extensive teaching experience (over 50% of respondents have been teaching for more than 16 years). The respondents underscore the importance of their educational activities, though this is perceived as slightly less central compared to their research endeavors.

  EAA Members’ Future Expectations

  Respondents expressed a clear interest in enhancing their teaching skills and methodologies. Many indicated a desire to learn more about adopting innovative learning approaches, such as case studies, collaborative learning, and problem/project-based learning and digital teaching technologies, such as generative AI, and digital tests and exams.

  Specifically, the most requested learning methodologies include:

  • Problem/Project Based Learning (PBL): 53%
  • Case studies: 51%
  • Collaborative learning: 45%
  • Competence-based learning: 40%
  • Design thinking: 40%
  • Gamification: 40%
  • Flipped Class: 28%
  • Peer feedback: 27%
  • Peer instruction: 19%
  • Dialogic Learning: 3%

   

  When it comes to digital teaching technologies, there’s a strong demand for knowledge on:

  • Generative AI (e.g., Large Language Models): 85%
  • Digital tests/exams: 44%
  • Learning analytics: 40%
  • Gaming: 36%
  • Learning management systems (e.g., Blackboard, Canvas, Moodle, other): 33%
  • Media production (e.g., video, podcasts, photographs, other): 28%
  • Webinar (recorded sessions) – to be viewed before or after a class meeting: 25%
  • Hybrid class (face to face and online class simultaneously): 24%
  • Social Media (Blogs, Facebook, Instagram, Podcast, Vlogs, Youtube Channel, Tiktok, other): 20%
  • Online class: 19%
  • Virtual/augmented reality: 19%
  • Spreadsheets: 18%
  • Voting systems: 14%
  • Video conference system (e.g., Google meet, Zoom, other): 13%

   

  Our Committee’s Response

  Our primary task in the EAA Education Committee is to serve our members. We asked you to tell us what kind of activities you would like the EAA to focus on, and at what level. Two main themes emerged strongly from your responses: Sustainability (at an advanced level) and AI in Education (at intermediate and advanced levels). Several other pertinent topics, such as Teaching differences in Undergraduate and Postgraduate education, Program content versus program form, Cryptoassets, Gamification, and Employability skills, were also frequently mentioned.

  Regarding the delivery of these new topics, members indicated a clear preference for existing channels such as Online Workshops and Courses, and the Education Committee Symposium during the EAA Annual Congress.

  We sincerely thank you for your time and effort in completing this survey. Your valuable responses are instrumental in helping the EAA identify how we can best support and enhance your educational development.

  On behalf of the entire EAA Education Committee,

  Anastasia Kopita (Chair)

• Academic Empathy Dialogue on Tax and Taxation

  The recording is available here.

  The EAA Virtual Activities Committee is delighted to announce that the next Academic Empathy Dialogue on Tax and Taxation will be held on April 20, 2026 at 3:00pm Brussels time. 

  This Academic Empathy Dialogue brings together Caren Sureth-Sloane and Lotta Björklund Larsen to explore how different disciplinary perspectives shape our understanding of taxation. The Dialogue will be moderated by Diana Falsetta. While both scholars study the role of taxes in shaping individual and societal behavior, their approaches differ markedly. Caren Sureth-Sloane’s work, grounded in economics and accounting, examines how taxation influences corporate decisions such as investment, risk-taking, and international business activity, as well as firms’ tax compliance and its enforcement. Lotta Björklund Larsen draws on qualitative social research and ethnographic methods to study how various stakeholders – individual and corporate taxpayers as well as tax administrators – on the tax arena interpret and practice taxation. She has explored issues such as trust, legitimacy, fairness surrounding compliance and takes a special interest in how various epistemologies foster tax compliance.

  By bringing together economic and anthropological perspectives, this dialogue seeks to foster mutual understanding across research traditions and encourage new ways of thinking about taxation as both an economic and a social phenomenon. The discussion will highlight opportunities for interdisciplinary collaboration and invite accounting researchers to reflect on how different methodological lenses can enrich the study of tax systems and taxpayer behavior.

  Registration is open at this link.