This paper investigates the relationship between the disclosure rate of non-financial measures and the four determinants that influence management decision to disclose such measures: (1) managerial significance, (2) the importance of measurement, (3) measurement difficulties and (4) the impact on financial figures. This study explores whether critical non-financial measures for medium- to long-term value creation are fully, or to what extent, disclosed in the integrated report (IR). Though published articles surrounding this topic are already in circulation, many researchers present normative arguments for the IR whilst there is little research examining the practice of IR itself (e.g. Dumay et al., 2016; KPMG, 2018). Thus, this paper examines current IR practice in Japan and explores which elements hinder companies’ attempts to disclose such measures and how to enhance disclosure practices of those measures, based on questionnaire data analysis. The author finds that many companies connect existing reports, such as the annual report and CSR report, into an integrated report, therefore more effective representation of business dynamics in a value creation context is needed. Further, the result suggests that companies refrain from addressing specific technology-related information when it has a high managerial significance, as it includes confidential matters advantageous to them. Besides, the result confirms that creating KPIs on a content element, such as the organizational overview element, leads to the enhancement of the integrated report.
Keywords: Integrated report, Non-financial information, Value Creation, Corporate Social Responsibility (CSR), Sustainability, AccountabilityKeywords: Integrated report, Non-financial information, Value Creation, Corporate Social Responsibility (CSR), Sustainability, Accountability