Common Good Disclosure

A framework for analysis

Authored by: Clelia Fiondella , Marco Maffei , Rosanna Spanò , Claudia Zagaria

Routledge Handbook of Social and Sustainable Finance

Print publication date:  June  2016
Online publication date:  June  2016

Print ISBN: 9781138777545
eBook ISBN: 9781315772578
Adobe ISBN: 9781317678830


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Disclosure in annual reports has raised growing attention in the accounting field, and previous literature has investigated the motivations behind its development, such as the need for more transparency and accountability (Uyar & Kılıç, 2012). What emerges is that disclosure improves the credibility of financial reporting (Healy & Palepu, 1993) and contributes to the understanding of the role of accounting information in firm valuation and corporate finance (Core, 2001). The issues relating to disclosure, especially in the Corporate Social Responsibility (CSR) domain (de Villiers & Alexander, 2014), are even more relevant in the context of ethical banks—such as mutual credit cooperative banks (Caldarelli, Fiondella, Maffei, Spanò, & Zagaria, 2014)—for two main reasons. First, these banks’ mission is characterized by a strong commitment to ethical values, thus encompassing in their business models social and environmental variables. The latter are usually not included in mandatory reports, but they can be voluntarily disclosed through other documents, helping ethical banks to report their broadest performance to stakeholders in order to meet their accountability and transparency needs. Second, these financial intermediaries are expected to provide disclosure—especially to satisfy stakeholders’ information needs—on the relationship between performance and exposure to risk factors (Frolov, 2007; Maffei, Aria, Fiondella, Spanò, & Zagaria, 2014).

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