{"id":1582,"date":"2021-10-22T14:42:21","date_gmt":"2021-10-22T12:42:21","guid":{"rendered":"https:\/\/eaa-online.org\/arc\/blog\/blog\/non-financial-disclosure-and-corporate-financial-performance-under-directive-201495eu-evidence\/"},"modified":"2021-10-22T14:42:21","modified_gmt":"2021-10-22T12:42:21","slug":"non-financial-disclosure-and-corporate-financial-performance-under-directive-201495eu-evidence","status":"publish","type":"post","link":"https:\/\/eaa-online.org\/arc\/blog\/2021\/10\/22\/non-financial-disclosure-and-corporate-financial-performance-under-directive-201495eu-evidence\/","title":{"rendered":"Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014\/95\/EU: Evidence from Italian Listed Companies"},"content":{"rendered":"<p class=\"rtejustify\">In the European Union countries, the non-financial disclosure (NFD) of large entities is mandated by law. Specifically, the Directive 2014\/95\/EU (known as the NFRD) requires large firms to report information covering aspects such as environmental, social, and employee-related matters, respect for human rights, and anti-corruption and bribery concerns. In addition to requiring companies to report information on certain aspects, the NFRD aimed at enhancing disclosure quality.&nbsp;<strong>Did this regulation serve its purpose?&nbsp;<\/strong><span data-preserver-spaces=\"true\">Mandatory disclosure is assumed to also have financial effects for companies.&nbsp;<\/span><strong>Is it the case looking at the Italian context?<\/strong><\/p>\n<p class=\"rtejustify\"><span data-preserver-spaces=\"true\">In our article &quot;<\/span><strong><span data-preserver-spaces=\"true\">Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014\/95\/EU: Evidence from Italian Listed Companies<\/span><\/strong><span data-preserver-spaces=\"true\">&quot; published in Accounting in Europe (<\/span><a href=\"https:\/\/doi.org\/10.1080\/17449480.2021.1979610\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">https:\/\/doi.org\/10.1080\/17449480.2021.1979610<\/span><\/a><span data-preserver-spaces=\"true\">), we (with co-authors Marisa Agostini and Ericka Costa) explore the following three research questions (RQs):<\/span><\/p>\n<p class=\"rtejustify\">RQ1: How does the quantity and quality of NFD develop in two reporting periods (voluntary and mandatory)?<br \/>\n\tRQ2: Is the quantity and quality of NFD by Italian listed companies associated with the CFP?<br \/>\n\t<span data-preserver-spaces=\"true\">RQ3: Is the quantity and quality of&nbsp;<\/span><em><span data-preserver-spaces=\"true\">mandatory NFD following Directive 2014\/95\/EU<\/span><\/em><span data-preserver-spaces=\"true\">&nbsp;by Italian listed companies associated with the CFP?<\/span><\/p>\n<p class=\"rtejustify\"><span data-preserver-spaces=\"true\">By conducting a content analysis and running several regressions, the following results have emerged. After the NFRD, the volume of information has increased but not the quality. However, there has been noted an increase of forward-looking information after the regulation. In terms of NFD association with financial performance, our results suggest that higher quality information is positively correlated with profitability. However, the same results do not hold when looking at the&nbsp;<\/span><strong><span data-preserver-spaces=\"true\">mandatory NFD<\/span><\/strong><span data-preserver-spaces=\"true\">&nbsp;association with financial performance. Non-financial information disclosed mandatorily is not significantly correlated with financial performance.<\/span><\/p>\n<p class=\"rtejustify\">These results suggest that formal legislation alone may not be sufficient to create a norm, and it does not imply sudden and radical changes in disclosure practices. While the quantity of information has increased following a legitimising effect, the same did not occur in terms of information quality. In addition, the inability of the NFRD to foster higher-quality disclosure is highlighted in the underlying relationship with the financial performance. The quality of mandatory NFD is not correlated with the financial performance thus failing to support the claims that it will enhance companies&#39; economic performance.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In the European Union countries, the non-financial disclosure (NFD) of large entities is mandated by law. Specifically, the Directive 2014\/95\/EU (known as the NFRD) requires large firms to report information covering aspects such as environmental, social, and employee-related matters, respect for human rights, and anti-corruption and bribery concerns. In addition to requiring companies to report [&hellip;]<\/p>\n","protected":false},"author":2627,"featured_media":1583,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0},"categories":[1],"tags":[2],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.12 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014\/95\/EU: Evidence from Italian Listed Companies - ARC<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014\/95\/EU: Evidence from Italian Listed Companies - ARC\" \/>\n<meta property=\"og:description\" content=\"In the European Union countries, the non-financial disclosure (NFD) of large entities is mandated by law. Specifically, the Directive 2014\/95\/EU (known as the NFRD) requires large firms to report information covering aspects such as environmental, social, and employee-related matters, respect for human rights, and anti-corruption and bribery concerns. In addition to requiring companies to report [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/eaa-online.org\/arc\/blog\/2021\/10\/22\/non-financial-disclosure-and-corporate-financial-performance-under-directive-201495eu-evidence\/\" \/>\n<meta property=\"og:site_name\" content=\"ARC\" \/>\n<meta property=\"article:published_time\" content=\"2021-10-22T12:42:21+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/eaa-online.org\/app\/uploads\/sites\/3\/2021\/10\/blerita_korca_0.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"373\" \/>\n\t<meta property=\"og:image:height\" content=\"480\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Blerita Korca\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Blerita Korca\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/eaa-online.org\/arc\/blog\/2021\/10\/22\/non-financial-disclosure-and-corporate-financial-performance-under-directive-201495eu-evidence\/\",\"url\":\"https:\/\/eaa-online.org\/arc\/blog\/2021\/10\/22\/non-financial-disclosure-and-corporate-financial-performance-under-directive-201495eu-evidence\/\",\"name\":\"Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014\/95\/EU: Evidence from Italian Listed Companies - ARC\",\"isPartOf\":{\"@id\":\"https:\/\/eaa-online.org\/arc\/#website\"},\"datePublished\":\"2021-10-22T12:42:21+00:00\",\"dateModified\":\"2021-10-22T12:42:21+00:00\",\"author\":{\"@id\":\"https:\/\/eaa-online.org\/arc\/#\/schema\/person\/6ab84a0e627de13195607caf2dc1313a\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/eaa-online.org\/arc\/blog\/2021\/10\/22\/non-financial-disclosure-and-corporate-financial-performance-under-directive-201495eu-evidence\/\"]}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/eaa-online.org\/arc\/#website\",\"url\":\"https:\/\/eaa-online.org\/arc\/\",\"name\":\"ARC\",\"description\":\"Advanced Resources Center\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/eaa-online.org\/arc\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/eaa-online.org\/arc\/#\/schema\/person\/6ab84a0e627de13195607caf2dc1313a\",\"name\":\"Blerita Korca\",\"url\":\"https:\/\/eaa-online.org\/arc\/blog\/members\/2627\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014\/95\/EU: Evidence from Italian Listed Companies - ARC","robots":{"index":"noindex","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"og_locale":"en_US","og_type":"article","og_title":"Non-Financial Disclosure and Corporate Financial Performance Under Directive 2014\/95\/EU: Evidence from Italian Listed Companies - ARC","og_description":"In the European Union countries, the non-financial disclosure (NFD) of large entities is mandated by law. 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