SMEs and IR: Evidence from Germany

Philipp Schorn (), Anne Tempel (), Ralf Bauer () and Ralf Klapdor ()
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Philipp Schorn: Rhine-Waal University of Applied Sciences
Anne Tempel: Rhine-Waal University of Applied Sciences
Ralf Bauer: Rhine-Waal University of Applied Sciences
Ralf Klapdor: Rhine-Waal University of Applied Sciences

A chapter in Development of Integrated Reporting in the SME Sector, 2021, pp 21-44 from Springer

Abstract: Abstract Small- and medium-sized enterprises (SMEs) are the backbone of the German economy. As accounting and disclosure rules are tied to legal form and size, SMEs face less strict requirements. Most SMEs are managed by their owners, and also the ‘bigger’ medium-sized enterprises are majority-owned by families. Therefore, German SMEs are reluctant to disclose information voluntarily. This provides SMEs in Germany with less incentives to adopt integrated reporting. Limited empirical evidence on integrated reporting is available and focuses only on listed corporations. Nonetheless, integrated reporting can be beneficial for SMEs as our analysis shows. Despite the current absence of legal requirements to implement more sophisticated reporting approaches, we identify political and social factors that render more enhanced reporting systems useful as numerous stakeholders demand more extensive information on environmental, social and governance issues. Furthermore, integrated reporting enables SMEs to create integrated information systems not only for external reporting but far more to improve internal processes and internal decision making.

Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:spr:csrchp:978-3-030-81903-3_2

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DOI: 10.1007/978-3-030-81903-3_2

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