IDEAS home Printed from https://ideas.repec.org/a/ris/joeasd/0014.html

The Impact of Financial and Non-Financial Capitals on JSE-Listed Companies – An Augmented Integrated Reporting Framework

Author

Listed:
  • Felix Chirairo

    (University of South Africa School of Business Leadership)

  • Prof Mashukudu Hartley Molele

    (University of South Africa School of Business Leadership)

Abstract

The measurement of the impact of non-financial capitals on company value within the context of integrated reporting (IR) has remained an elusive empirical and practitioner question. The IR framework was designed to provide an improved corporate reporting approach to different stakeholders. However, the framework falls short of providing a tool that practitioners and stakeholders could use to determine how company value has changed over time. Objectives: The main objective of this research was to produce an enhanced IR framework through an Augmented Integrated Reporting Model (AIRM). Methods: The model tested the relationship of five capitals (financial, manufactured, intellectual, human, and social and relationship capitals) to company value. The study used quantitative research methodology that utilised panel data fixed effects regression analysis in EViews software. Results: The AIRM demonstrates that social and relationship capital have a positive impact on market share price, EVA and TobinQ, while association to share price at book value is negative. Human capital has a positive relationship to market share price and a negative influence on EVA, TobinQ and share price at book value. Intellectual and manufactured capital have positive associations with the four dependent variables of company value. Conclusions: This research implies that a contribution has been made in resolving the challenge of quantifying and measuring non-financial capitals and how they impact company value. The study recommends that IR report preparers, report analysts, investors, academics, and other relevant stakeholders use the AIRM to measure and manage the various capitals in the process of company value creation

Suggested Citation

  • Felix Chirairo & Prof Mashukudu Hartley Molele, 2024. "The Impact of Financial and Non-Financial Capitals on JSE-Listed Companies – An Augmented Integrated Reporting Framework," Journal of Economic and Social Development, Clinical Journals Press, vol. 11(01), pages 01-09.
    • Handle: RePEc:ris:joeasd:0014
    as

    Download full text from publisher

    File URL: https://www.jesd-online.com/articles/the-impact-of-financial-and-nonfinancial-capitals-on-jselisted-companies--an-augmented-integrated-reporting-framework.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. de Villiers, Charl & Sharma, Umesh, 2020. "A critical reflection on the future of financial, intellectual capital, sustainability and integrated reporting," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 70(C).
    2. Jerry Hausman, 2015. "Specification tests in econometrics," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 38(2), pages 112-134.
    3. Flower, John, 2015. "The International Integrated Reporting Council: A story of failure," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 27(C), pages 1-17.
    4. Elda du Toit, 2017. "The readability of integrated reports," Meditari Accountancy Research, Emerald Group Publishing Limited, vol. 25(4), pages 629-653, October.
    5. Adams, Carol A. & Potter, Brad & Singh, Prakash J. & York, Jodi, 2016. "Exploring the implications of integrated reporting for social investment (disclosures)," The British Accounting Review, Elsevier, vol. 48(3), pages 283-296.
    6. Thilini Cooray & Samanthi Senaratne & A. D. Nuwan Gunarathne & Roshan Herath & Dileepa Samudrage, 2020. "Does Integrated Reporting Enhance the Value Relevance of Information? Evidence from Sri Lanka," Sustainability, MDPI, vol. 12(19), pages 1-25, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nuradhi Kalpani Jayasiri & Sriyalatha Kumarasinghe & Rakesh Pandey, 2023. "12 years of integrated reporting: A review of research," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 63(2), pages 2187-2243, June.
    2. Irma Malafronte & John Pereira, 2026. "What comes first? The chicken–egg relationship between integrated thinking and reporting," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 30(1), pages 225-260, March.
    3. O'Dwyer, Brendan & Humphrey, Chris & Rowbottom, Nick, 2024. "From institutional integration to institutional demise: The disintegration of the International Integrated Reporting Council (IIRC)," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 99(C).
    4. Sara Trucco & Maria Chiara Demartini & Valentina Beretta, 2021. "The reporting of sustainable development goals: is the integrated approach the missing link?," SN Business & Economics, Springer, vol. 1(2), pages 1-13, February.
    5. Dimes, Ruth & de Villiers, Charl, 2024. "Hallmarks of Integrated Thinking," The British Accounting Review, Elsevier, vol. 56(1).
    6. La Torre, Matteo & Dumay, John & Rea, Michele Antonio & Abhayawansa, Subhash, 2020. "A journey towards a safe harbour: The rhetorical process of the International Integrated Reporting Council," The British Accounting Review, Elsevier, vol. 52(2).
    7. Kofi Mintah Oware & T. Mallikarjunappa, 2023. "Financial Performance and Gender Diversity: The Moderating and Mediating Effect of CSR Disclosure and Expenditure of Listed Firms in India," Vision, , vol. 27(2), pages 243-255, April.
    8. Warren Maroun, 2020. "A Conceptual Model for Understanding Corporate Social Responsibility Assurance Practice," Journal of Business Ethics, Springer, vol. 161(1), pages 187-209, January.
    9. Ricardo Pinto & Isabel Lourenço & Ana Simões, 2022. "Does Innovation Spur Integrated Reporting?," Sustainability, MDPI, vol. 15(1), pages 1-20, December.
    10. Patrick Velte, 2022. "Does sustainable corporate governance have an impact on materiality disclosure quality in integrated reporting? International evidence," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(6), pages 1655-1670, December.
    11. Lodovico Gherardi & Anna Maria Linsalata & Enrico Deidda Gagliardo & Rebecca Levy Orelli, 2021. "Accountability and Reporting for Sustainability and Public Value: Challenges in the Public Sector," Sustainability, MDPI, vol. 13(3), pages 1-18, January.
    12. Estibaliz Goicoechea & Fernando Gómez-Bezares & José Vicente Ugarte, 2019. "Integrated Reporting Assurance: Perceptions of Auditors and Users in Spain," Sustainability, MDPI, vol. 11(3), pages 1-19, January.
    13. Maria Federica Izzo & Alberto Dello Strologo & Fabrizio Granà, 2020. "Learning from the Best: New Challenges and Trends in IR Reporters’ Disclosure and the Role of SDGs," Sustainability, MDPI, vol. 12(14), pages 1-22, July.
    14. Maria-Gabriella Baldarelli & Antonietta Cosentino & Mara Del Baldo & Angela Magistro, 2024. "Feminist Approach to Integrated Reporting: Theory of the Firm and Practice in Dialogue," International Journal of Business and Management, Canadian Center of Science and Education, vol. 19(6), pages 1-26, December.
    15. Kelli Juliane Favato & Marguit Neumann & Simone Leticia Raimundini Sanches & Manuel Castelo Branco & Daniel Ramos Nogueira, 2021. "Integrated Thinking and Reporting Process: Sensemaking of Internal Actors in the Case of Itaú Unibanco," JRFM, MDPI, vol. 14(6), pages 1-16, June.
    16. Felix Chirairo & Prof Mashukudu Hartley Molele, 2024. "Social and relationship capital effect on the value of firms listed on the Johannesburg Stock Exchange ? An integrated reporting approach," Journal of Economic and Social Development, Clinical Journals Press, vol. 11(01), pages 01-09.
    17. Teresa Izzo & Antonella Russo & Gianluca Risaliti, 2025. "Integrated Reporting, Stakeholders' Perspective and Sustainable Disclosure: Systematic Insights From Empirical Research," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 32(4), pages 4978-5005, July.
    18. Linda Kannenberg & Philipp Schreck, 2019. "Integrated reporting: boon or bane? A review of empirical research on its determinants and implications," Journal of Business Economics, Springer, vol. 89(5), pages 515-567, July.
    19. Anna Pistoni & Lucrezia Songini & Francesco Bavagnoli, 2018. "Integrated Reporting Quality: An Empirical Analysis," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 25(4), pages 489-507, July.
    20. Genevé Richard & Elza Odendaal, 2021. "Credibility-enhancing mechanisms, other than external assurance, in integrated reporting," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 25(1), pages 61-93, March.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:joeasd:0014. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Marijan Cingula (email available below). General contact details of provider: http://www.eclinicalsci.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.