Integrated Reporting and Assurance of Sustainability Information: An Experimental Study on Professional Investors' Information Processing

47 Pages Posted: 15 Dec 2016

See all articles by Daniel Reimsbach

Daniel Reimsbach

Heinrich Heine University Dusseldorf

Rüdiger Hahn

University of Hohenheim

Anil Gürtürk

University of Kassel

Date Written: 2017

Abstract

Sustainability-related non-financial information is increasingly deemed value relevant. Against this background, two recent trends in non-financial reporting are frequently discussed: integrated reporting and assurance of sustainability information. Using an established framework of information acquisition, evaluation, and weighting, this experimental study investigated how the choice of reporting format interacts with the voluntary assurance of sustainability information. The results from a sample of professional investors underline the important role of assurance in the context of voluntary disclosure and illustrate the relevant interaction with the reporting format. Assurance of sustainability information positively affected professional investors’ evaluation of a firm’s sustainability performance, resulted in a higher weighting of this information, and led to higher investment-related judgments. However, this assurance effect was weaker in the case of integrated reporting compared to separate reporting. We attribute this effect to a cognitive bias in decision making when assured financial performance and non-assured sustainability performance are presented in the same report.

Keywords: Integrated Reporting, Sustainability Reporting, Assurance, Experiment

Suggested Citation

Reimsbach, Daniel and Hahn, Rüdiger and Gürtürk, Anil, Integrated Reporting and Assurance of Sustainability Information: An Experimental Study on Professional Investors' Information Processing (2017). Forthcoming, European Accounting Review (doi: 10.1080/09638180.2016.1273787), Available at SSRN: https://ssrn.com/abstract=2885665

Daniel Reimsbach

Heinrich Heine University Dusseldorf ( email )

Düsseldorf, DE
Germany

Rüdiger Hahn (Contact Author)

University of Hohenheim ( email )

Germany

Anil Gürtürk

University of Kassel

Nora-Platiel-Straße 1
34109 Kassel, Hessen 34127
Germany

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