Integrated reporting and financial reporting quality of listed firms in Ghana: The moderating role of the sustainable development goals reporting

Abstract

The study sought to assess the influence of integrated reporting practices on the financial reporting quality of listed firms in Ghana, and the moderating effect of corporate Sustainable Development Goals (SDG) reporting on the relationship between integrated reporting and financial reporting quality of listed in Ghana. The criterion sampling technique was used to select twentyone (21) listed firms in the banking and manufacturing sectors. Using a quantitative research approach and an explanatory research design, content analysis of the annual reports of selected firms (from 2016 to 2020) was employed as the main data collection instrument as disclosure indexes were developed to extract panel data on the study variables. The data obtained was processed and analyzed using Eviews. Both descriptive (frequencies) and inferential (the System Generalized Method of Moments (GMM) regression panel estimator) methods were employed. The findings demonstrate a high level of adherence (57.14%) of firm annual reports to all three dimensions of the IIRC integrated reporting framework. Integrated reporting and corporate SDG reporting both had a significant positive effect on the financial reporting quality of listed firms, with corporate SDG reporting having a statistically significant moderating effect. Consequently, it was recommended that regulatory authorities create a Ghanaian adaptation of the IIRC integrated reporting framework and mandate the publication of integrated reports for listed firms in Ghana. Management and those in charge of governance of listed firms are also urged to act to enhance integrated reporting practices and SDG disclosures in their corporate reporting policies.