Integrated reporting adoption, disclosure, and media legitimacy: evidence from the IIRC Pilot Programme

Neri, Lorenzo and Gaia, S. and Leoni, G. (2025) Integrated reporting adoption, disclosure, and media legitimacy: evidence from the IIRC Pilot Programme. Meditari Accountancy Research , ISSN 2049-372X.

Abstract

Purpose – In recent years, several businesses worldwide have started to adopt a more integrated approach to corporate disclosure, following the integrated reporting (IR) framework. This paper explores whether and how a firm’s voluntary decision to adopt integrated reporting and the extent of its integrated disclosure impact negative media coverage related to ESG issues. Design/methodology/approach – The study investigates the disclosures of 93 international firms from the International Integrated Reporting Council (IIRC) Pilot Programme and a matching sample of 93 similar firms issuing traditional sustainability reports to assess the impact on media coverage around ESG issues. The final sample consists of 1,116 company-year observations over a six-year period. Findings – The results indicate that the voluntary adoption of integrated reporting alone does not significantly impact a firm's level of media exposure. However, greater alignment of integrated disclosures with the IR framework results in reduced negative media exposure. These findings hold when the negative exposure is related solely to governance issues, but not when it pertains only to social or environmental issues. Originality/value – This study provides evidence that a greater extent of integrated disclosure leads to more favourable media coverage of a business regarding ESG issues. This suggests that the media use the information disclosed by companies to inform their news and positively value the disclosure provided, especially when it aligns with the IR framework. Research limitations/implications – The results of this study contribute to accounting and business research on media and corporate disclosure by providing new insights into how the media value integrated corporate disclosures. The results indicate that the media particularly value the adoption of the IR framework when it is applied more extensively, especially in relation to governance issues. They also demonstrate that analysing this reporting tool benefits from a perspective rooted in media legitimacy theory. This theory suggests that when facing negative media coverage, businesses can use corporate disclosures to shape media attention and restore their legitimacy. Practical implications – The findings of our work provide valuable insights for practitioners and the IFRS Foundation, guiding the refinement of the IR framework and reinforcing the growing global emphasis on corporate social and environmental performance. Furthermore, the study’s implications extend to managers, investors, and policymakers. In accounting environments where IR is not mandatory, managers can use these insights to adopt IR practices, improving management quality through a comprehensive, integrated approach beyond financial metrics. Seeking external assurance can further strengthen the credibility of IR reports, fostering trust among stakeholders, including the media.

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