The limits of environmental accounting disclosure: enforcement of regulations, standards and interpretative strategies

Purpose - The objective of this study is to provide insights into insiders' perspectives on environmental accounting disclosures, which is relatively under-investigated. Based on insights from key managers, we provide information on company decisions and practices related to the data disclosed in annual reports. More specifically, we explore how regulation guidance affects and shapes disclosure strategies. Design/methodology/approach - Drawing on the normativity framework, our research design involves a multiple-case study focusing on eight French listed firms in sensitive industries. We primarily build our investigation on the analysis of annual reports. Semi-structured interviews with 20 key managers belonging to these same firms provide interpretative explanations of the disclosed (and un-disclosed) figures. Findings - Our main findings show that the disclosure of environmental accounting information (EAI) is still in its infancy. Weak definitions and poor guidance in regulations explain the limitations in disclosure and induce interpretative strategies depending on the type of data to be disclosed in the companies' annual reports. We document that separate logics drive environmental expenditure and environmental liability disclosures in many respects. Practical implications - This study should be useful for regulators because environmental accounting standards are currently subject to change and helpful for users because of the careful consideration of disclosures. Originality/value - Our research is timely and adds to the growing body of research on regulation. We document how a common regulation may lead to interpretative strategies by different actors and networks of actors, thereby contributing to shaping EAI norms.