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A Proposal for Reform of EU Member States’ Corporate Governance Codes in Support of Sustainability

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Open AccessArticle

Comprehensive Approach to Relevant and Reliable Reporting in Europe: A Dream Impossible?

Faculty of Law, University of Oslo, Oslo 0162, Norway
Faculty of Law, University of Helsinki, 00014 Helsinki, Finland
Sustainability 2020, 12(13), 5277;
Received: 27 November 2019 / Revised: 27 December 2019 / Accepted: 18 June 2020 / Published: 30 June 2020
Corporate reporting and governance are interlinked: Accounting and reporting inventions created the modern company, and without the modern company there is no entity from which to report. Due to its raison d’etre, reporting remained finance-centered, to protect financial capital providers. From the 1970’s, the question of the interests of ‘stakeholders’ emerged, with attempts of ‘social reporting’, ‘corporate social responsibility’, ‘environmental’, and ‘social and environmental’ and finally ‘integrated’ accounting and reporting. These trends are reflected also in the European Union legal framework, both in regulation of especially financial intermediaries and the ‘non-financial’ reporting. This article is based on an extensive literature review, research conducted in the Sustainable Market Actors for Responsible Trade (SMART) project, and socio-legal and economic empirical research based conceptual analysis of the impact of these reporting systems and their relationship to financial accounting and reporting. The result of the research is that sustainability is reduced to focus on institutional investors and other members in the investment supply chain, and climate change issues only, and new regulatory solutions are required. Based on the most recent developments in EU law and in European jurisdictions, possible paths forward are envisaged to encourage sustainability in reporting and assurance, and through that, in governance. As an outcome a set of regulatory reform proposals are given based on the SMART recommendations.
Keywords: reporting; governance; financial reporting; sustainability reporting; sustainability reporting; governance; financial reporting; sustainability reporting; sustainability
MDPI and ACS Style

Mähönen, J. Comprehensive Approach to Relevant and Reliable Reporting in Europe: A Dream Impossible? Sustainability 2020, 12, 5277.

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