Integrated Reporting in practice: Insights on Intellectual Capital and Big Data

Integrated reporting is gaining momentum as a paradigm that redefines the traditional reporting boundary. Promoted by the International Integrated Reporting Council (IIRC), it is tracing a new path for corporate reporting due to its combination of financial and non-financial information in a single document, the integrated report (IR). Such report aims to convey how the company’s strategy, governance, performance and prospects lead to the creation of value in the short, medium and long term. IR is prepared in accordance with the principle-based guidance of the International Integrated Reporting Framework, which provides impetus for an interconnected approach to corporate reporting and includes six forms of capitals in portraying the value creation process: financial, manufactured, intellectual, human, social and relationship, and natural capitals. Integrated reporting and IR provide new scope for researches on both intellectual capital (IC) and Big Data. More specifically, IR entangles three intangible, non-financial capitals in its value creation story that have been traditionally named IC. Further, its preparation requires a huge amount of strategic, operational, and performance information to be gathered and processed. In this regard, the IIRC has urged companies to adopt Big Data as a single, combined information architecture that assists in implementing integrated reporting. In 2018, it has also launched an initiative aimed at collecting early experiences about Big Data by companies that issue IR. The overall purpose of this thesis is to unveil how subjects involved in the IR preparation (i.e. IR preparers) deal with IC and Big Data while engaging in integrated reporting. In particular, this thesis inspects integrated reporting in practice from three different, but interrelated perspectives to gain insights on IC and Big Data. It is a collection of three papers that respectively address: 1) the ontology of IC (first paper); 2) the performativity of IC (second paper); and 3) the epistemic authority of Big Data (third paper). By assuming an insider viewpoint, this thesis benefits from in-depth interviews with the companies’ members to explore the process of IR preparation. It adopts a critical/interpretative methodological approach that allows to reach the IR preparers’ ideas and experiences. Such approach also allows to gain knowledge and understanding about the flourishing integrated reporting process, by unpacking the underlying procedures concerned with it. The first paper sheds new light on the subjective nature of IC ontology. Such ontology emerges in the function that IR preparers assign to IC in the process of IR preparation. The study shows that integrated thinking helps develop a unique idea on how IC exists in the process of value creation. It is the first study to empirically investigate IC ontology in the integrated reporting context. The second paper reveals that IC definition, classification and valuation stimulate ongoing interaction among various actors. Some sketches, matrixes and maps inspired by the International Integrated Reporting Framework are pivotal in defining concepts and categories of IC and its connection to value creation. The paper enriches the scant research that examines the performativity of IC in the context of corporate external reporting. Finally, the third paper offers exploratory insights on the extent to which corporate members might rely on Big Data while preparing their IR. It suggests that the epistemic authority of Big Data might stem from both the energy that the company devotes to exploiting Big Data and the identification of prospective information. The study contributes to the infant literature on Big Data in corporate reporting by focusing on the process of IR preparation