How to Assess Voluntary Disclosure: an index to measure stakeholder reporting and social accounting across Italy and US

Institutional and small investors, financial analysts and other key stakeholders are demanding more information about long-term strategies and profitability of companies. The growing information needs seemingly force managers to disclose more: (1) operational information, (2) performance analysis and (3) forward-looking data. However, little evidence is available concerning company’s disclosure policies addressed to stakeholders other than investors. This paper studies the non-mandatory information available on the web sites of 36 leading companies across Italy and U.S, the main objective is to describe companies’ information patterns in order to better understand voluntary disclosure choices. In particular, observed disclosures are presented through an original framework that purports to combine strategic and stakeholder reporting. This framework is based on seven perspectives that highlight information addressed to key stakeholders categories and information concerning business effectiveness and efficiency. Finally, an index attempts to measure the disclosure’s quality and it provides a first analysis of differences amongst industries and countries. A limited, but strategic, use of the non-mandatory information seems to influence the observed companies’ disclosure policies. Furthermore, cultural effects are likely to affect forms, quality and types of information released. These findings may be useful in providing an insight to further research on voluntary information addressed to stakeholders, other than investors, and they could also be helpful to accounting organizations that are attempting to regulate and control disclosure practices.