Work

The role of users’ engagement in shaping financial reporting: should activists target accounting more?

Year: 2021

Type: article

Abstract: We define accounting engagement as stakeholders’ actions taken with the intention of influencing corporate reporting. Using this definition, we review the literature on such activism and discuss avenues for research. The evidence reviewed suggests accounting engagement is rare. We reflect on the reasons of this, given evidence on increasing overt engagement on other corporate issues, such as managerial compensation and governance, social, and environmental responsibility. Both information production and information acquisition costs have decreased over time, raising further questions about why engagement has not increased. We consider potential reasons linked to concerns over whether financial reporting meets users’ information needs, particularly, given the emergence of new users and the role of new technologies in the diffusion and processing of information. These concerns have accompanied claims of increasing complexity of financial accounting and the threat of information overload.

Source: Accounting and Business Research

DOI: 10.1080/00014788.2021.1932261

Authors: Beatriz García Osma, Cristina Grande-Herrera

Institutions: Universidad Carlos III de Madrid, University of London, City, University of London

Language: English

Topic: Accounting Theory and Financial Reporting

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $2,970

Funder: Comunidad de Madrid