Hostname: page-component-77c89778f8-fv566 Total loading time: 0 Render date: 2024-07-20T11:35:33.680Z Has data issue: false hasContentIssue false
  • English
  • Français

Non-financial reporting and SMEs: A systematic review, research agenda, and novel conceptualization

Published online by Cambridge University Press:  01 September 2023

Silvia Lisi ,
Benito Mignacca Open the ORCID record for Benito Mignacca [Opens in a new window]  and
Michele Grimaldi
Silvia Lisi
Affiliation:
Department of Enterprise Engineering, University of Rome Tor Vergata, Roma, Italy
Benito Mignacca*
Affiliation:
Department of Civil and Mechanical Engineering, University of Cassino and Southern Lazio, Cassino (FR), Italy
Michele Grimaldi
Affiliation:
Department of Civil and Mechanical Engineering, University of Cassino and Southern Lazio, Cassino (FR), Italy
*
Corresponding author: Benito Mignacca; Email: benito.mignacca@unicas.it
Get access Rights & Permissions [Opens in a new window]

Abstract

Policymakers, academics, and practitioners are increasingly discussing non-financial reporting (NFR) initiatives, i.e., reporting initiatives that are related to environmental and social matters. The implementation of NFR initiatives in the context of small and medium-sized enterprises (SMEs) is a key topic. Based on a systematic literature review, this article first synthesizes what we know about the mechanisms underlying NFR initiatives implemented by SMEs. A thematic analysis led to the identification and examination of drivers, enabling factors, and challenges for NFR initiatives. Relevant drivers include legitimacy-based motivations, competitive advantage, and stakeholder engagement. Enabling factors include specific guidelines and tools for NFR. Lack of capabilities and lack of standardization are significant challenges. Second, drawing on the thematic analysis and on what we do not know about NFR in the context of SMEs, a novel conceptualization of NFR as a process characterized by three main phases is presented. Last, this article suggests future research opportunities.

Keywords

non-financial reportingsmall- and medium-sized enterprisessustainability reportingnon-financial disclosurecorporate reporting
Type
Research Article
Information
Journal of Management & Organization , First View , pp. 1 - 23
Copyright
© The Author(s), 2023. Published by Cambridge University Press in association with the Australian and New Zealand Academy of Management

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Arena, M., & Azzone, G. (2012). A process-based operational framework for sustainability reporting in SMEs. Journal of Small Business and Enterprise Development, 19(4), 669–686.CrossRefGoogle Scholar
Bartolacci, F., Caputo, A., & Soverchia, M. (2020). Sustainability and financial performance of small and medium sized enterprises: A bibliometric and systematic literature review. Business Strategy and the Environment, 29(3), 1297–1309.CrossRefGoogle Scholar
Beckers, C., Marz, O., & Kolbe, L. M. (2013). Investing in sustainability: A practice-oriented approach to analyze IT-investments in sustainability reporting systems. International Journal of Social Ecology and Sustainable Development, 4(2), 99–120.CrossRefGoogle Scholar
BEIS 04. (2020). Frameworks for standards for non-financial reporting. BEIS research paper number 2020/052. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/935097/frameworks-for-standards-for-non-financial-reporting.pdf.Google Scholar
Bellantuono, N., Pontrandolfo, P., & Scozzi, B. (2016). Capturing the stakeholders’ view in sustainability reporting: A novel approach. Sustainability (Switzerland), 8(4), .Google Scholar
Bergmann, A., & Posch, P. (2018). Mandatory sustainability reporting in Germany: Does size matter? Sustainability (Switzerland), 10(11), .Google Scholar
Borga, F., Citterio, A., Noci, G., & Pizzurno, E. (2009). Sustainability report in small enterprises: Case studies in Italian furniture companies. Business Strategy and the Environment, 18(3), 162–176.CrossRefGoogle Scholar
Braun, V., & Clarke, V. (2006). Using thematic analysis in psychology. Qualitative Research in Psychology, 3(2), 77–101.CrossRefGoogle Scholar
Bunclark, L., & Barcellos-Paula, L. (2021). Sustainability reporting for sustainable supply chain management in Peru. Sustainable Production and Consumption, 27, 1458–1472.Google Scholar
Calabrese, A., Costa, R., Levialdi Ghiron, N., & Menichini, T. (2019). Materiality analysis in sustainability reporting: A tool for directing corporate sustainability towards emerging economic, environmental and social opportunities. Technological and Economic Development of Economy, 25(5), 1016–1038.CrossRefGoogle Scholar
Calabrese, A., Costa, R., Levialdi, N., & Menichini, T. (2016). A fuzzy analytic hierarchy process method to support materiality assessment in sustainability reporting. Journal of Cleaner Production, 121, 248–264.CrossRefGoogle Scholar
Caputo, F., Pizzi, S., Ligorio, L., Leopizzi, R., & Jonico in sistemi giuridici ed economici del mediterraneo, D. (2021). Enhancing environmental information transparency through corporate social responsibility reporting regulation. Business Strategy and the Environment, 30(8), 3470–3484.CrossRefGoogle Scholar
Caputo, A., Pizzi, S., & Santini, E. (2022). Call for papers – Sustainability and SMEs: Opening the black box. Journal of Management & Organization.Google Scholar
Cardoni, A., Kiseleva, E., & Bellucci, A. (2022). The quality of SMEs stakeholder communication during strategic crises: The case of Italian unlisted SMEs. Business Strategy and the Environment, 33, 1–17.Google Scholar
Casadei, A., & Amadei, F. (2010). The competitive influence of corporate social responsibility and corporate social disclosure in Italian small and medium sized companies: Focus on disclosure and competitive drivers. Social and Environmental Accountability Journal, 30(1), 13–25.CrossRefGoogle Scholar
Corazza, L. (2017). The standardization of down-Streamed Small Business Social Responsibility (SBSR): SMEs and their sustainability reporting practices. Information Resources Management Journal, 30(4), 39–52.CrossRefGoogle Scholar
Corazza, L. (2018). Small business social responsibility: The CSR4UTOOL web application. Journal of Applied Accounting Research, 19(3), 383–400.CrossRefGoogle Scholar
Dabić, M., Maley, J., Dana, L. P., Novak, I., Pellegrini, M. M., & Caputo, A. (2020). Pathways of SME internationalization: A bibliometric and systematic review. Small Business Economics, 55(3), 705–725.CrossRefGoogle Scholar
Dalton, V. (2020). The challenge of engaging with and reporting against the SDGs for SMEs such as Sydney Theatre Company. Journal of Management & Organization, 26, 975–994.Google Scholar
Del Baldo, M. (2017). The implementation of integrating reporting <IR> in SMEs: Insights from a pioneering experience in Italy. Meditari Accountancy Research, 25(4), 505–532.CrossRefGoogle Scholar
Denyer, D., & David, T. (2009). Producing a systematic review. In Buchanan, D. A. & Bryman, A. (Eds.), The Sage Handbook of organizational research methods (pp. 671–689). United States: Sage Publications Ltd.Google Scholar
de Villiers, C., & van Staden, C. J. (2006). Can less environmental disclosure have a legitimising effect? Evidence from Africa. Accounting, Organizations and Society, 31(8), 763–781.CrossRefGoogle Scholar
Díaz Díaz, B., & García Ramos, R. (2015). Corporate social responsibility: Current and future perspectives in Spain. In CSR, sustainability, ethics and governance (pp. 413–433).Google Scholar
Di Maddaloni, F., & Davis, K. (2017). The influence of local community stakeholders in megaprojects: Rethinking their inclusiveness to improve project performance. International Journal of Project Management, 35(8), 1537–1556.CrossRefGoogle Scholar
Dinh, T., Husmann, A., & Melloni, G. (2022). Corporate sustainability reporting in Europe: A scoping review. Accounting in Europe, 20(1), 1–29.CrossRefGoogle Scholar
Dos Santos, P. G., Albuquerque, F., Rodrigues, M. A. B., & Morais, A. I. (2022). The views of stakeholders on mandatory or voluntary use of a simplified standard on non-financial information for SMEs in the European Union. Sustainability (Switzerland), 14(5), .Google Scholar
European Council. (2022). Council gives final green light to corporate sustainability reporting directive. Retrieved November 29 , 2022, from https://www.consilium.europa.eu/en/press/press-releases/2022/11/28/council-gives-final-green-light-to-corporate-sustainability-reporting-directive/.Google Scholar
European Parliament. (2014). DIRECTIVE 2014/95/EU of 22 October 2014 – Amending Directive 2013/34/EU as regards disclosure of non-financial and diversity information by certain large undertakings and groups.Google Scholar
Ferrer-Serrano, M., Fuentelsaz, L., & Latorre-Martinez, M. P. (2022). Examining knowledge transfer and networks: An overview of the last twenty years. Journal of Knowledge Management, 26(8), 2007–2037.CrossRefGoogle Scholar
Font, X., Guix, M., & Bonilla-Priego, M. J. (2016). Corporate social responsibility in cruising: Using materiality analysis to create shared value. Tourism Management, 53, 175–186.CrossRefGoogle Scholar
Gao, F., Dong, Y., Ni, C., & Fu, R. (2016). Determinants and economic consequences of non-financial disclosure quality. European Accounting Review, 25(2), 287–317.CrossRefGoogle Scholar
Gerwanski, J. (2020). Managers’ incentives and disincentives to engage with integrated reporting or why managers might not adopt integrated reporting: An exploratory study in a nascent setting. Qualitative Research in Accounting and Management, 17(4), 553–587.CrossRefGoogle Scholar
Girella, L., Zambon, S., & Rossi, P. (2019). Reporting on sustainable development: A comparison of three Italian small and medium-sized enterprises. Corporate Social Responsibility and Environmental Management, 26(4), 981–996.Google Scholar
Greco, M., Strazzullo, S., Cricelli, L., Grimaldi, M., & Mignacca, B. (2022). The fine line between success and failure: An analysis of open innovation projects. European Journal of Innovation Management, 25(6), 687–715.CrossRefGoogle Scholar
GRI. (2021). GRI – Standards. Retrieved April 15 , 2022, from https://www.globalreporting.org/how-to-use-the-gri-standards/resource-center/?g=4e4ffa56-5bb1-41ff-9bd4-dd3d8edae340&id=12358.Google Scholar
Hahn, R., & Kühnen, M. (2013). Determinants of sustainability reporting: A review of results, trends, theory, and opportunities in an expanding field of research. Journal of Cleaner Production, 59, 5–21.CrossRefGoogle Scholar
Hodge, K., Subramaniam, N., & Stewart, J. (2009). Assurance of sustainability reports: Impact on report users’ confidence and perceptions of information credibility. Australian Accounting Review, 19(3), 178–194.Google Scholar
Hojnik, J., Biloslavo, R., Cicero, L., & Cagnina, M. R. (2020). Sustainability indicators for the yachting industry: Empirical conceptualization. Journal of Cleaner Production, 249, .Google Scholar
IIRC. (2021). Council | Integrated Reporting.Google Scholar
Imperiale, F., Pizzi, S., & Lippolis, S. (2023). Sustainability reporting and ESG performance in the utilities sector. Utilities Policy, 80, .Google Scholar
Jackson, G., Bartosch, J., Avetisyan, E., Kinderman, D., & Knudsen, J. S. (2020). Mandatory non-financial disclosure and its influence on CSR: An international comparison. Journal of Business Ethics, 162(2), 323–342.CrossRefGoogle Scholar
Johnson, M. P., & Schaltegger, S. (2016). Two decades of sustainability management tools for SMEs: How far have we come? Journal of Small Business Management, 54(2), 481–505.Google Scholar
Kassem, E., & Trenz, O. (2020). Automated sustainability assessment system for small and medium enterprises reporting. Sustainability (Switzerland), 12(14), .Google Scholar
Kassem, E., Trenz, O., Hřebíček, J., & Faldík, O. (2017). Sustainability assessment and reporting in agriculture sector. Acta Universitatis Agriculturae Et Silviculturae Mendelianae Brunensis, 65(4), 1359–1369.CrossRefGoogle Scholar
Kinderman, D. (2020). The tenuous link between CSR performance and support for regulation: Business associations and Nordic regulatory preferences regarding the corporate transparency law 2014/95/EU. Business and Politics, 22(3), 413–448.CrossRefGoogle Scholar
Kolk, A. (2003). Trends in sustainability reporting by the Fortune Global 250. Business Strategy and the Environment, 12(5), 279–291.CrossRefGoogle Scholar
Krawczyk, P. (2021). Non-financial reporting—Standardization options for SME sector. Journal of Risk and Financial Management, 14(9), .CrossRefGoogle Scholar
Krechovská, M., & Procházková, P. T. (2014). Sustainability and its integration into corporate governance focusing on corporate performance management and reporting. Procedia Engineering, 69, 1144–1151.CrossRefGoogle Scholar
Krištofik, P., Lament, M., & Musa, H. (2016). The reporting of non-financial information and the rationale for its standardisation. Business Administration and Management, 19, 157–175.Google Scholar
Kurniawan, P. S. (2018). An implementation model of sustainability reporting in village-owned enterprise and small and medium enterprises. Indonesian Journal of Sustainability Accounting and Management, 2(2), 90–106.CrossRefGoogle Scholar
La Torre, M., Sabelfeld, S., Blomkvist, M., Tarquinio, L., & Dumay, J. (2018). Harmonising non-financial reporting regulation in Europe. Meditari Accountancy Research, 26(4), 598–621.CrossRefGoogle Scholar
Locatelli, G., Greco, M., Invernizzi, D. C., Grimaldi, M., & Malizia, S. (2020). What about the people? Micro-foundations of open innovation in megaprojects. International Journal of Project Management, 39, 115–127.CrossRefGoogle Scholar
Lombardi, R., Cosentino, A., Sura, A., & Galeotti, M. (2021). The impact of the EU Directive on non-financial information: Novel features of the Italian case. Meditari Accountancy Research, 30, 1419–1448.CrossRefGoogle Scholar
Macht, S. A., Chapman, R. L., & Fitzgerald, J. A. (2020). Management research and the United Nations Sustainable Development Goals. Journal of Management and Organization, 26, 917–928.CrossRefGoogle Scholar
Martins, A., Branco, M. C., Melo, P. N., & Machado, C. (2022). Sustainability in small and medium-sized enterprises: A Systematic literature review and future research agenda. Sustainability (Switzerland), 14(11), .Google Scholar
Medel, F., García, L., Enriquez, S., & Anido, M. (2011). Reporting models for corporate sustainability in SMEs. In Environmental Science and Engineering (Subseries: Environmental Science) (pp. 407–418).Google Scholar
Mignacca, B., & Locatelli, G. (2020). Economics and finance of Small Modular Reactors: A systematic review and research agenda. Renewable and Sustainable Energy Reviews, 118(September 2019), .Google Scholar
Mignacca, B., & Locatelli, G. (2021). Modular circular economy in energy infrastructure projects: Enabling factors and barriers. Journal of Management in Engineering, 37, 1–13 .CrossRefGoogle Scholar
Mignacca, B., Locatelli, G., & Velenturf, A. (2020). Modularisation as enabler of circular economy in energy infrastructure. Energy Policy, 139, .CrossRefGoogle Scholar
Moneva, J. M., & Hernández-Pajares, J. (2018). Corporate social responsibility performance and sustainability reporting in SMEs: An analysis of owner-managers’ perceptions. International Journal of Sustainable Economy, 10(4), 405–420.CrossRefGoogle Scholar
Morais, F., & Ferreira, J. J. (2020). SME internationalisation process: Key issues and contributions, existing gaps and the future research agenda. European Management Journal, 38(1), 62–77.CrossRefGoogle Scholar
Nave, E., Ferreira, J. J., Fernandes, C. I., Paço, A. D., Alves, H., & Raposo, M. (2022). A review of succession strategies in family business: Content analysis and future research directions. Journal of Management & Organization, 1–25.CrossRefGoogle Scholar
Nigri, G., & Baldo, M. D. (2018). Sustainability reporting and performance measurement systems: How do small- and medium- sized benefit corporations manage integration? Sustainability (Switzerland), 10(12), .Google Scholar
O’Dochartaigh, A. (2019). No more fairytales: A quest for alternative narratives of sustainable business. Accounting, Auditing and Accountability Journal, 32(5), 1384–1413.Google Scholar
O’Donovan, G. (2002). Environmental disclosures in the annual report: Extending the applicability and predictive power of legitimacy theory. Accounting, Auditing & Accountability Journal, 15(3), 344–371.CrossRefGoogle Scholar
OECD. (2019). SME and entrepreneurship outlook 2019, Paris: OECD Publishing. https://doi.org/10.1787/34907e9c-enGoogle Scholar
Ortiz-Martínez, E., & Marín-Hernández, S. (2022). European SMEs and non-financial information on sustainability. International Journal of Sustainable Development and World Ecology, 29(2), 112–124.CrossRefGoogle Scholar
Ortiz-Martínez, E., Marín-Hernández, S., & Santos-Jaén, J. M. (2023). Sustainability, corporate social responsibility, non-financial reporting and company performance: Relationships and mediating effects in Spanish small and medium sized enterprises. Sustainable Production and Consumption, 35, 349–364.CrossRefGoogle Scholar
Pizzi, S., Corbo, L., & Caputo, A. (2021). Fintech and SMEs sustainable business models: Reflections and considerations for a circular economy. Journal of Cleaner Production, 281, .CrossRefGoogle Scholar
Pizzi, S., Venturelli, A., & Caputo, F. (2021). The “comply-or-explain” principle in directive 95/2014/EU. A rhetorical analysis of Italian PIEs. Sustainability Accounting, Management and Policy Journal, 12(1), 30–50.CrossRefGoogle Scholar
Prashar, A., & Sunder, M. V. (2020). A bibliometric and content analysis of sustainable development in small and medium-sized enterprises. Journal of Cleaner Production, 245, .Google Scholar
Ramos, T. B., Cecílio, T., Douglas, C. H., & Caeiro, S. (2013). Corporate sustainability reporting and the relations with evaluation and management frameworks: The Portuguese case. Journal of Cleaner Production, 52, 317–328.CrossRefGoogle Scholar
Reverte, C. (2015). The new Spanish corporate social responsibility strategy 2014-2020: A crucial step forward with new challenges ahead. Journal of Cleaner Production, 91, 327–336.CrossRefGoogle Scholar
Rodríguez-Gutiérrez, P., Guerrero-Baena, M. D., Luque-Vílchez, M., & Castilla-Polo, F. (2021). An approach to using the best-worst method for supporting sustainability reporting decision-making in SMEs. Journal of Environmental Planning and Management, 64(14), 2618–2640.CrossRefGoogle Scholar
Russo, A., & Tencati, A. (2009). Formal vs. informal CSR strategies: Evidence from Italian Micro, small, medium-sized, and large firms. Journal of Business Ethics, 85(2), 339–353.CrossRefGoogle Scholar
Sajjad, A., & Eweje, G. (2014). Corporate social responsibility in Pakistan: Current trends and future directions. Critical Studies on Corporate Responsibility, Governance and Sustainability, 8, 163–187.CrossRefGoogle Scholar
Shields, J., & Shelleman, J. M. (2015). Integrating sustainability into SME strategy. Journal of Small Business Strategy, 25(2), 59–76.Google Scholar
Shields, J., & Shelleman, J. (2020). SME sustainability dashboards: An aid to manage and report performance. Journal of Small Business Strategy, 30(2), 106–114.Google Scholar
Siew, R. Y. J. (2015). A review of corporate sustainability reporting tools (SRTs). Journal of Environmental Management, 164, 180–195.CrossRefGoogle ScholarPubMed
Singh, M. P., & Roy, M. (2019). A study of sustainability reporting disclosures for manufacturing MSMEs: Evidence from India. International Journal of Entrepreneurship and Small Business, 38(4), 395–414.CrossRefGoogle Scholar
Skouloudis, A., Evangelinos, K., & Kourmousis, F. (2010). Assessing non-financial reports according to the Global Reporting Initiative guidelines: Evidence from Greece. Journal of Cleaner Production, 18(5), 426–438.CrossRefGoogle Scholar
Somoza, A. (2022). Voluntary sustainability assurance in small and medium-sized entities: The role of country origin in Europe. Business Strategy and the Environment, 32, 462–483.Google Scholar
Stawicka, E., & Paliszkiewicz, J. (2021). Social media in communicating about social and environmental issues—non-financial reports in Poland. Information (Switzerland), 12(6), .Google Scholar
Stolowy, H., & Paugam, L. (2018). The expansion of non-financial reporting: An exploratory study. Accounting and Business Research, 48(5), 525–548.CrossRefGoogle Scholar
Tarquinio, L., & Posadas, S. C. (2020). Exploring the term “non-financial information”: An academics’ view. Meditari Accountancy Research, 28(5), 727–749.CrossRefGoogle Scholar
Tarquinio, L., & Rossi, A. (2017). Determinants of corporate social responsibility reporting and external assurance: Evidence from Italian-listed companies. International Journal of Accounting, Auditing and Performance Evaluation, 13(4), 398–420.CrossRefGoogle Scholar
Tranfield, D., Denyer, D., & Smart, P. (2003). Towards a methodology for developing evidence-informed management knowledge by means of systematic review. British Journal of Management, 14(3), 207–222.Google Scholar
Tsalis, T. A., Malamateniou, K. E., Koulouriotis, D., & Nikolaou, I. E. (2020). New challenges for corporate sustainability reporting: United Nations’ 2030 Agenda for sustainable development and the sustainable development goals. Corporate Social Responsibility and Environmental Management, 27(4), 1617–1629.Google Scholar
Turzo, T., Marzi, G., Favino, C., & Terzani, S. (2022). Non-financial reporting research and practice: Lessons from the last decade. Journal of Cleaner Production, 345, .CrossRefGoogle Scholar
United Nations. (2015). Sustainable development goals | United Nations Development Programme. Retrieved July 10 , 2022, from https://sdgs.un.org/publications/transforming-our-world-2030-agenda-sustainable-development-17981.Google Scholar
United Nations. (2021). Why does corporate sustainability reporting matter to rebuilding better?/Policy brief N. 99. Retrieved July 10 , 2022, from https://www.un.org/development/desa/dpad/wp-content/uploads/sites/45/publication/PB_99.pdf.Google Scholar
Vaismoradi, M., Turunen, H., & Bondas, T. (2013). Content analysis and thematic analysis: Implications for conducting a qualitative descriptive study. Nursing & Health Sciences, 15(3), 398–405.CrossRefGoogle ScholarPubMed
Valenza, G., & Damiano, R. (2023). Sustainability reporting and public value: Evidence from port authorities. Utilities Policy, 81, .CrossRefGoogle Scholar
Vaquero Martín, M., Reinhardt, R., & Gurtner, S. (2016). Stakeholder integration in new product development: A systematic analysis of drivers and firm capabilities. R and D Management, 46, 1095–1112.CrossRefGoogle Scholar
Vermicelli, S., Cricelli, L., Grimaldi, M., Mignacca, B., & Strazzullo, S. (2022). Crowdsourcing initiatives during the COVID-19 pandemic: Empirical evidence from the Italian context. European Journal of Innovation Management, Ahead-of-print. https://doi.org/10.1108/EJIM-06-2022-0341CrossRefGoogle Scholar
Vicente-Saez, R., & Martinez-Fuentes, C. (2018). Open Science now: A systematic literature review for an integrated definition. Journal of Business Research, 88, 428–436.CrossRefGoogle Scholar
Vrontis, D., Iazzi, A., Maizza, A., & Cavallo, F. (2020). Stakeholder engagement in the hospitality industry: An analysis of communication in SMES and large hotels. Journal of Hospitality and Tourism Research, 46, 1–23.Google Scholar
The World Bank. (2022). Small and Medium Enterprises (SMEs) Finance. Retrieved June 27 , 2022, from https://www.worldbank.org/en/topic/smefinance.Google Scholar
Zarzycka, E., & Krasodomska, J. (2022). Non-financial key performance indicators: What determines the differences in the quality and quantity of the disclosures? Journal of Applied Accounting Research, 23(1), 139–162.CrossRefGoogle Scholar
Zieba, M., & Johansson, E. (2022). Sustainability reporting in the airline industry: Current literature and future research avenues. Transportation Research Part D: Transport and Environment, 102, .CrossRefGoogle Scholar