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Do integrated report readability and tone convey value relevant information? International evidence

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  • Hossain, Amir
  • Bose, Sudipta
  • Shamsuddin, Abul

Abstract

Integrated reporting (IR) holistically integrates material financial and non-financial information concisely and cohesively to provide value-relevant information to capital providers. This study examines the effect of integrated report readability and tone on the market value of equity. Using 2,707 firm-year observations across 41 countries, we find that having a more readable and optimistic tone in integrated reports positively affects the market value of equity. This positive association between readability and tone with market value of equity is particularly pronounced in firms with higher institutional ownership. This relationship is further amplified in stakeholder-oriented countries, countries where English is not the official language, and financially opaque environments. Additionally, the information content of integrated report readability and tone shows a positive association with the market value of equity. Given that firms have been gradually adopting IR practices to create sustainable value, the findings of this study are of significance to regulators, standard-setters, policy makers, investors and firms.

Suggested Citation

  • Hossain, Amir & Bose, Sudipta & Shamsuddin, Abul, 2025. "Do integrated report readability and tone convey value relevant information? International evidence," Journal of Contemporary Accounting and Economics, Elsevier, vol. 21(3).
    • Handle: RePEc:eee:jocaae:v:21:y:2025:i:3:s1815566925000359
    DOI: 10.1016/j.jcae.2025.100488
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    JEL classification:

    • M40 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M49 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Other
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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