From the corporate social responsibility reporting to the integrated reporting: the case of Sabaf S.p.a

In December 2013, the International Integrated Reporting Council (IIRC) published the International Integrated Reporting Framework. The aim of the Framework is to provide the guiding principles and the content elements of an integrated report. The integrated report constitutes an evolutionary step in the corporate’s financial and non-financial communication, moving from the social responsibility reporting to the integrated reporting. This practice is at the beginning in Europe and especially in Italy where only few listed companies have decided to face the multitude of challenges the integrated report implies. Considering the relevance of such a new form of communication, the paper examines the main steps carried out by an Italian listed company moving towards the integrated report. The research has been conducted by adopting a qualitative case study approach, by focusing on Sabaf S.p.a, an Italian listed medium sized company belonging to the Star Segment. This company has been selected because it was one of the first adopters of the integrated report among the Italian listed companies. The study builds on data gathered through sites visits, structured interviews and company materials. The paper examines Sabaf’s transition from the corporate social responsibility report to the integrated report, aiming at answering the following research question: Why has Sabaf moved to integrated reporting? Which are Sabaf’s main steps towars the integrated report? How is the Sabaf’s integrated reporting process going? The findings should be of interest to a number of parties including Standard Setters, firms, financial advisors, auditors and users of non-financial statements

Digital Transformation and Convergence toward the 2030 Agenda’s Sustainability Development Goals: Evidence from Italian Listed Firms

The United Nations 2030 Agenda has emphasized the potential of digital technology to enhance sustainability performance, assuming that digital transformation can enable firms’ convergence toward the Sustainable Development Goals. Despite this, the literature is unclear regarding whether there is a positive relationship between digitalization and sustainability, as the effects of digital transformation are controversial. The main goal of this study was to assess the hypothesis that digital technology contributes to the achievement of Sustainable Development Goals within the UN 2030 Agenda. To test this hypothesis, a textual analysis was performed to assess Italian firms’ digitalization efforts; the obtained results were then related to the selected firms’ ESG scores using a regression analysis. The analysis focused on Italian FTSE MIB listed firms for the period 2016–2019. The findings show a positive relation between digitalization and Sustainable Development Goals, highlighting the relevance of digital technology in implementing the sustainability agenda

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The Small-Sized Premium: Is It Really Relevant? Evidence from the European Equity Market

The valuation of a company reflects the expected return—that is, the cost of capital that investors demand in exchange for the risk assumed. Despite the ex-ante nature of the problem, the majority of empirical analysis has focused on factors explaining expected returns from an ex-post perspective. In this paper, we take a different approach and try to identify which factors are ex-ante included in discount rates, with particular attention to the so-called size premium. Starting from observed market capitalizations and company fundamentals, we obtain the implied cost of capital from the reverse engineering of a carefully designed fundamental valuation model. Panel data regressions are used to investigate the existence of a relation between the implied cost of capital and the firm’s size, including other control variables representative of the most cited asset pricing “anomalies.” Our sample comprises European non-financial stocks listed on primary markets, with half-yearly observations starting from the aftermath of the 2008 global financial crisis. Contrary to common wisdom, we find that the firm’s size has no tangible impact to explain the implied cost of capital