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Amsterdam Business School Amsterdam Business School

How sustainability reporting standard setters gain and lose influence: The rise and demise of the International Integrated Reporting Council (IIRC)

Brendan O'Dwyer | 2024

Accounting section researcher Brendan O’Dwyer and his co-authors undertook a decade-long longitudinal case study examining the process through which the body behind Integrated Reporting, the International Integrated Reporting Council (IIRC), rose to prominence but eventually lost influence as it was subsumed into the International Sustainability Standards Board (ISSB). The paper identifies a number of strategic choices and actions that explain the IIRC’s trajectory from 2013 to 2023 and considers their implications for the future of Integrated Reporting.
Brendan O'Dwyer
Brendan O'Dwyer

What sparked your curiosity?

I was involved in an early pilot study with CFOs and other corporate actors seeking to work out what Integrated Reporting might involve in practice in The Netherlands. I was also a member of the academic team that produced a book on Accounting for Sustainability in 2010 which partly underpinned the launch of the IIRC and the ambitious agenda it attached to Integrated Reporting. Given the rapid developments in the area of sustainability reporting in the past four years, I wanted to understand how the IIRC had evolved in response to these developments, how and why its leadership made certain strategic decisions, and how this might affect the future of Integrated Reporting.

What did you discover?

Our analysis illustrates how the IIRC started out with seemingly good intentions and a commitment to comprehensive corporate reporting change but persistently struggled in practice to realise its ambitious aims. Rather than creating a dynamically different new corporate reporting norm, the IIRC was subsumed within other standard setting bodies, while Integrated Reporting  was gradually stripped down to a framework centred mainly on the interests of the financial investor. We find that the more things were removed or downgraded from the IIRC’s vision of Integrated Reporting, the less need there was for a body such as the IIRC.

Why do these findings matter?

Our study offers a fine-grained historical analysis of the trajectory of a body behind a ground-breaking corporate reporting initiative. It offers a unique perspective on recent developments in sustainability reporting standard setting, particularly the complexity and compromises involved in global standard setting in sustainability reporting. The case of the IIRC contains several lessons for policy makers and standard setting bodies struggling to secure the global standardisation of sustainability reporting.

Literature:

O’Dwyer, B., Humphrey, C. and Rowbottom, N. (2024). From institutional integration to institutional demise: The disintegration of the International Integrated Reporting Council (IIRC). Critical Perspectives on Accounting. 99, 102699.

Read the paper