Form of voluntary disclosure: recommendations and business practices in Europe and U.S

The voluntary disclosure of company's private information is increasingly at the center of theattention of managers. This tendency has also been analyzed by several accounting organizations- AICPA1, FASB2, IASC3 and also SEC4 - which have recently developed several documents onthe subject. This paper examines the strategic value of the voluntary communication, presents the maindifferences that still exist between the practices of public disclosure in the U. S. and Europe,explains the process that has led the accounting organizations to issue official recommendationsand, finally provides suggestions for the voluntary release of performance evaluation measures. All the reports issued by the accounting organizations are mainly based on North Americanacademic studies and research committees that have investigated the increasing importance of themarket-based assets. However, other European research centers - ACCA5, CSEA6, ISEA7, andOECD8 - have further developed a different idea of voluntary disclosure. This perspective isstrictly connected with the social and environmental accounting and furthermore, these studiesshow that an increasing number of companies are continuing to adopt and advance this body ofresearch. The process that has led many North American and European managers to pay more attention tothe disclosure of operational and financial measures presents similarities and also differences. The public release of company's private information can be alternatively related with a strategicuse of the communication system, in order to meet the information needs of investors, or with anew definition of long-term business sustainability. Consequently, the present article explains theconnections between the official accounting organizations' reports on voluntary disclosure andthese two main approaches. In summary, this paper focuses on how and why the main accounting organizations and researchcenters have attempted to help managerial decisions by encouraging voluntary disclosure ofprivate and non-financial information. The fourth section also proposes a different frameworkwith the intention of improving the release of performance measures.