• Abstract

    This study examines the intricate interdependence of organisational management control systems (MCS), sustainability integration, and financial reporting. Empirical analysis highlights the need for a holistic and multi-faceted integration of internal systems, particularly across management accounting, financial reporting, and sustainability. The research outlines the challenges and benefits of embedding sustainability principles into management systems, demonstrating potential gains in efficiency, risk mitigation, and competitive advantage. One of the critical conclusions that emerged based on the conducted study is related to the perception of Managerial Discretion. Acknowledging the invariance of top management roles and behaviours is crucial when designing reporting systems. Tailoring the system to the specific environmental conditions the organisation faces is essential, striving for a balance between maximising opportunities and maintaining control. Comprehensive integration between management accounting, financial reporting, and sustainability systems addresses concerns about the disparity in sophistication between financial and sustainability performance indicators. A one-size-fits-all approach is impractical, necessitating a distinct project approach for each organisation when implementing the reporting management function. It is suggested that organisations should be diversified according to their size and maturity level in order to identify specific and concrete measures aimed at building an effective reporting system. The author enhanced the critical role of top management in defining, designing, and implementing a practical reporting governance framework. This framework should ensure alignment with the organisation's strategic objectives and needs. A successful organisational structure hinges on establishing and maintaining the "tone at the top". By promoting a positive "tone at the top," management fosters a sustainable and successful corporate culture, paving the way for future development and achieving strategic goals. These conclusions offer valuable insights for organisations seeking to establish robust and effective reporting systems that support informed decision-making, stakeholder engagement, and sustainable value creation.

  • References

    1. Adams, C. A. (2015). The international integrated reporting council: a call to action. Critical Perspectives on Accounting. 27, 23-28. https://doi.org/10.1016/j.cpa.2014.07.001
    2. Akimov, O., Karpa, M., Parkhomenko-Kutsevil, O., Kupriichuk, V., & Omarov, A. (2021). Entrepreneurship education of the formation of the e-commerce managers professional qualities. International Journal of Entrepreneurship, 25(7).
    3. Aranchiy, V., Ganushchak-Efimenko, L., Khrystenko, L., Shkoda, M., Hnatenko, I., Fastovets, N. (2022). Modeling of integrated assessment of the effectiveness of management of the financial position of business entities. Financial and credit activities: problems of theory and practice, 1(42), 259–270. https://doi.org/10.55643/fcaptp.1.42.2022.3526
    4. Bayev, V. V., Bakhov, I. S., Mirzodaieva, T. V., Rozmetova, O., & Boretskaya, N. (2022). Theoretical and methodological fundamentals of the modern paradigm of quality management in the field of tourism. Journal of Environmental Management and Tourism, 13(2), 338-345. https://doi.org/10.14505/jemt.v13.2(58).04
    5. Beusch, P., Frisk, J., Rosen, M., & Dilla, W.N. (2015). Management Control for Sustainability: The Development of a Fully Integrated Strategy. AAA 2016 Management Accounting Section (MAS) Meeting Paper. https://ssrn.com/abstract=2644396. Accessed on March 28, 2024.
    6. Bezverkhyi, K. (2014). Methodological principles of forming integrated reporting of an enterprise. Accounting and Finance, 3(65), 8-14. https://er.knutd.edu.ua/handle/123456789/3997. Accessed on March 28, 2024.
    7. Bondarenko, S., Bratko, A., Antonov, V., Kolisnichenko, R., Hubanov, O., & Mysyk, A. (2022). Improving the state system of strategic planning of national security in the context of informatization of society. Journal of Information Technology Management, 14, 1-24. https://doi.org/10.22059/jitm.2022.88861
    8. Bondarenko, S., Halachenko, O., Shmorgun, L., Volokhova, I., Khomutenko, A., & Krainov, V. (2021). The effectiveness of network systems in providing project maturityof public management. TEM Journal, 10(1), 272-282. https://doi.org/10.18421/TEM101-34
    9. Bosi, M. K., Lajuni, N., Wellfren, A. C., & Lim, T. S. (2022). Sustainability reporting through environmental, social, and governance: A bibliometric review. Sustainability, 14(19). https://doi.org/10.3390/su141912071
    10. Bowen, F. (2014). After greenwashing: Symbolic corporate environmentalism and society. Cambridge University Press.
    11. Buallay, A. (2019). Is sustainability reporting (ESG) associated with performance? Evidence from the European banking sector. Management of Environmental Quality: An International Journal, 30(1), 98-115. https://www.emerald.com/insight/content/doi/10.1108/MEQ-12-2017-0149/full/html. Accessed on March 28, 2024.
    12. Bushman, R., Chen, Q., Engel, E., & Smith, A. (2004). Financial accounting information, organizational complexity and corporate governance systems. Journal of Accounting and Economics, 37(2), 167-201. https://doi.org/10.1016/j.jacceco.2003.09.005
    13. Clark, G.L., Feiner, A., & Viehs, M. (2014). From the stockholder to the stakeholder: how sustainability can drive financial outperformance. SSRN Electronic journal. https://doi.org/10.2139/ssrn.2508281
    14. Cooper, D.J., & Morgan, W. (2013). Meeting the evolving corporate reporting needs of government and society: Arguments for a deliberative approach to accounting rule making. Accounting & Business Research, 43(4), 418-441. https://doi.org/10.1080/00014788.2013.794411
    15. Davydiuk, T. (2012). Convergence of accounting and social reporting in terms of human capital: Development of existing approaches. Economics: The Realities of Time, 2(3), 123-129. https://economics.net.ua/23-2. Accessed on March 28, 2024.
    16. Doyle, J., Ge, W., & McVay, S. (2007). Determinants of weaknesses in internal control over financial reporting. Journal of Accounting and Economics, 44(1-2), 193-223. https://doi.org/10.1016/j.jacceco.2006.10.003
    17. Drucker, P. (1986). s. Management: Tasks, responsibilities, practice. Truman Talley books.
    18. Eldridge, J., & Crombie, A. (1974). A sociology of organisations. (RLE: Organizations). Routledge.
    19. Fayol H. (1954). General and industrial management. Pitman.
    20. Finkelstein, S., Hambrick, D.C., & Cannella, A.A. (2009). Strategic leadership: Theory and research on executives, top management teams, and boards. Oxford University Press. https://doi.org/10.1093/acprof:oso/9780195162073.001.0001
    21. Gompers, P., Ishii, J., & Metrick, A. (2003). Corporate governance and equity prices. The quarterly journal of economics, 118(1), 107-156. https://www.jstor.org/stable/25053900
    22. Gond, J.-P., Grubnic, S., Herzig, C., & Moon, J. (2012). Configuring Management Control Systems: Theorizing the Integration of Strategy and Sustainability. Management Accounting Research, 23(3), 205-223. https://doi.org/10.1016/j.mar.2012.06.003
    23. Kussainov, K., Goncharuk, N., Prokopenko, L., Pershko, L., Vyshnivska, B., & Akimov, O. (2023). Anti-corruption management mechanisms and the construction of a security landscape in the financial sector of the EU economic system against the background of challenges to european integration: Implications for artificial intelligence technologies. Economic Affairs (New Delhi), 68(1), 509-521. https://doi.org/10.46852/0424-2513.1.2023.20
    24. Latysheva, O., Rovenska, V., Smyrnova, I., Nitsenko, V., Balezentis, T., & Streimikiene, D. (2020). Management of the sustainable development of machine-building enterprises: A sustainable development space approach. Journal of Enterprise Information Management, 34(1), 328-342. https://doi.org/10.1108/JEIM-12-2019-0419
    25. Mamchur, R., Minochkina, O., Ianushevych, Ia., Khrystenko, L. (2023). Optimization of Operational and Financial Risks of Conducting Business Activities Under the Conditions of Changes and Sustainable Development. Economic Affairs, 68(01), 91-98. https://doi.org/10.46852/0424-2513.1s.2023.11
    26. Quattrone, P., Busco, C., Frigo, M., & Riccaboni, A. (2013). Redefining corporate accountability through integrated reporting: What happens when values and value creations meet? Strategic Finance, 8, 33-41. https://www.research.ed.ac.uk/en/publications/redefining-corporate-accountability-through-integrated-reporting. Accessed on March 28, 2024.
    27. Roberts, C., Weetman, P., & Gordon, P. (2008). International corporate reporting: A comparative approach. FT Prentice Hall.
    28. Rowbottom, N., & Locke, J. (2016). The emergence of . Accounting and Business Research, 46, 1, 83-115. https://doi.org/10.1080/00014788.2015.1029867
    29. Sabelfeld, S., Dumay, J., & Torre, M. (2023). Adapting integrated reporting through the stages of local rationalisation. Accounting forum. https://doi.org/10.1080/01559982.2023.2180836
    30. Schein, E.H. (1999). The corporate culture survival guide. Jossey-Bass.
    31. Velte, P. (2022). Archival research on integrated reporting: a systematic review of main drivers and the impact of integrated reporting on firm value. Journal of Management and Governance, 19, 997-1061. https://doi.org/10.1007/s10997-021-09582-w
    32. Vitolla, F., Raimo, N., & Rubino, M. (2019). Appreciations, criticisms, determinants, and effects of integrated reporting: A systematic literature review. Corporate Social Responsibility and Environmental Management, 2(26), 518-528. https://doi.org/10.1002/csr.1734
    33. Zayed, N. M., Edeh, F. O., Darwish, S., Islam, K. M. A., Kryshtal, H., Nitsenko, V., & Stanislavyk, O. (2022). Human resource skill adjustment in service sector: Predicting dynamic capability in post COVID-19 work environment. Journal of Risk and Financial Management, 15(9). https://doi.org/10.3390/jrfm15090402
    34. Zhang, D. (2019). Top management team characteristics and financial reporting quality. The Accounting Review, 94(5), 349-375. https://doi.org/10.2308/accr-52360

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Copyright (c) 2024 The Authors

How to cite

Biloblovskyi, S., Haidaienko, O., Khrystenko, L., Demchuk, O., & Morozova, H. (2024). Integrated reporting management: Optimising organisational performance. Multidisciplinary Reviews, 7, 2024spe016. https://doi.org/10.31893/multirev.2024spe016
  • Article viewed - 11
  • PDF downloaded - 10