The Value Relevance of Non-Financial Performance Indicators: New Cues from the European Fashion Industry

Financial Reporting, Forthcoming

25 Pages Posted: 5 Oct 2011

See all articles by Francesco Dainelli

Francesco Dainelli

University of Florence - Department of Business Administration

Francesco Giunta

University of Florence - Dipartimento di Scienze Aziendali

Date Written: October 5, 2011

Abstract

Intangible assets and related performance measures assume increasing importance in valuation processes. Value relevance studies testify to their importance through an analysis of market stock prices. We aim to examine the value relevance of non-financial indicators in European fashion companies. The indicator selected is the 'change in mono-brand stores'. Applying the models proposed by current literature, we have refuted the value relevance hypothesis. However, refining both the 'operationalization' of the concepts and the related result analysis procedure, the value relevance is confirmed. In this way, we contribute to increasing the generalizability of this research trend and to fuel the debate concerning the standardization process of this information. In particular, following in the footsteps of the Gartner/EBRC project, supported by AICPA (Gartner-EBRC, 2010), our results can help the national and international standard setters to pinpoint the indicators that really matter for the fashion industry and standardize their communication.

Keywords: intangibles, value relevance, financial measures, non-financial measures, fashion industry, mono-brand stores

JEL Classification: M40, G14

Suggested Citation

Dainelli, Francesco and Giunta, Francesco, The Value Relevance of Non-Financial Performance Indicators: New Cues from the European Fashion Industry (October 5, 2011). Financial Reporting, Forthcoming, Available at SSRN: https://ssrn.com/abstract=1938979

Francesco Dainelli (Contact Author)

University of Florence - Department of Business Administration ( email )

via delle Pandette, 9
Florence, Florence 50127
Italy

Francesco Giunta

University of Florence - Dipartimento di Scienze Aziendali ( email )

Piazza di San Marco, 4
Florence, 50121
Italy

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