 Bridging the Gap Between Legitimacy and Voluntary Disclosure Theory and Current Corporate Nonfinancial Reporting Practices: Insights From Japanese CompaniesKimitaka Nishitani, Jin Dong Park and Mohammad Badrul Haider Business Strategy and the Environment, 2025, vol. 34, issue 2, 2449-2468 Abstract: The purpose of this study is to bridge the gap between conventional assumptions of legitimacy and voluntary disclosure theories and current practices of corporate nonfinancial reporting. The analysis conducts regressions using data on 244 Japanese companies in 2019 to clarify whether the triadic relationship between a company's nonfinancial reporting motivation and practices and user information satisfaction is consistent. It contributes to the literature by showing that conventional assumptions have limitations in explaining the triadic relationship and identifying the mechanism underpinning how corporate nonfinancial reporting functions. First, although companies are more motivated by financial accountability than legitimacy in nonfinancial reporting, these motivations are not directly opposing, but are instead relative. Second, even when the financial accountability and legitimacy motivations are clear, they do not consistently satisfy user information needs. Finally, companies fulfil the financial accountability role only after they fulfil the legitimacy role. Date: 2025 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:bstrat:v:34:y:2025:i:2:p:2449-2468 Ordering information: This journal article can be ordered from Access Statistics for this article Business Strategy and the Environment is currently edited by Richard Welford More articles in Business Strategy and the Environment from Wiley Blackwell |
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