The ungreening of integrated reporting: a reflection on regulatory capture

Purpose The initial rationale for developing integrated reporting included addressing the failures of traditional reporting to address sustainability issues. Subsequently, the International Integrated Reporting Council (IIRC) modified its stated objectives to emphasise integrated thinking and value creation. There has been debate on whether the IIRC’s process for developing its integrated reporting framework was subject to regulatory capture by the accounting profession (Flower, 2015; Adams, 2015; Thomson, 2015). This paper aims to provide additional evidence on the extent to which this regulatory capture occurred, with an update on current developments. Design/methodology/approach Data from interviews with key participants in the integrated reporting framework’s development and the IIRC’s Council and Working Group meeting minutes were analysed to identify to what extent the change in the IIRC’s focus can be explained by regulatory capture theory. Findings The findings show that the integrated reporting framework’s development was subject to regulatory capture by accountants. However, the extent of capture was mitigated to some extent by processes adopted in its development. This is consistent with regulatory capture theory. Originality/value This paper critically examines the debate on the extent to which the sustainability message has been lost as a result of regulatory capture. It provides an in-depth analysis of the IIRC’s treatment of sustainability which explores the application of regulatory capture theory and examines evidence not considered in previous studies.

Corporate environmental accountability in Nigeria: an example of regulatory failure and regulatory capture

PurposeThe purpose of this study is to investigate how state regulations become ineffective in holding corporations accountable for environmental degradation in an emerging economy context, with a specific focus on oil and gas and cement industry in Nigeria.Design/methodology/approachThe study draws on capture theory to bring out the factors that have rendered redundant the state intervention to make corporations accountable for their environmental activities. The research setting is the oil and gas and cement industry in Nigeria. Data for the study are derived from both documentary analysis and semi-structured interviews and analysed using a thematic technique.FindingsThe findings of the paper demonstrate a regulatory failure to hold corporations to account for their environmental activities. A lack of political will, outdated regulations and the manipulation of the regulators, all have played a part in preventing corporations from being accountable for their activities. In addition, the widespread elite corruption in the country has provided corporations with leeway to manipulate their environmental accountability practices. The study emphasises the need for continuous review of the regulations and efforts to reduce corruption in order to promote corporations' environmental accountability in Nigeria.Research limitations/implicationsThe research is limited to Nigeria, oil and gas and cement industries. The theoretical lens can be used to address problem of capture of the regulations and institution in the country.Practical implicationsThe practical implication is that it would enhance environmental regulations in Nigeria and emerging economies. It will also provide support from researchers emerging markets on the adoption of capture theory in future research.Social implicationsIt will promote corporate best environmental practices in the country. It will reduce the issues surrounding environmental accountability practices and create awareness on environmental issues among the populace. It will create the impression that corporations will be held accountable for their environmental activities in the country and the need to have improved environmental regulations in the country.Originality/valueThe study adds to the debate on corporate environmental accountability practices engendering insights from the Nigerian oil and gas and cement industry. The paper demonstrates how companies in emerging economies can capture state regulations and how rendering environmental accountability becomes more of rhetoric than a reality with little impacts on the welfare of people and society.

Beyond cynicism and fatalism: Three lessons for a social studies of financial regulation

This chapter argues for the benefits of going beyond existing approaches to financial regulation centred on capture theory and critical commentary on the epistemic limits of regulatory enterprise. Building upon the research programme of science studies and the social studies of finance, three lessons are identified which may help researchers break free from the critical doom loop of cynicism and fatalism: (1) Listen to the actors, (2) models matter, and (3) discover that macro in the micro.