Working Paper | HBS Working Paper Series | 2014

Integrated Reporting and Investor Clientele

by George Serafeim


In this paper, I examine the relation between Integrated Reporting (IR) and the composition of a firm's investor base. I hypothesize and find that firms that practice IR have a more long-term oriented investor base with more dedicated and fewer transient investors. This result is more pronounced for firms with high growth opportunities, not controlled by a family, operating in "sin" industries, and exhibiting more stable IR practice over time. I find that the results are robust to the inclusion of firm fixed effects, controls for the quantity of sustainability disclosure, and alternative ways of measuring IR. Moreover, I show that investor activism on environmental or social issues or a large number of concerns about a firm's environmental or social impact leads a firm to practice more IR and that this investor or crisis-induced IR affects the composition of a firm's investor base.

Keywords: sustainability; sustainability reporting; integrated reporting; reporting; disclosure; disclosure strategy; investor behavior; investor communication; investment management; corporate accountability; corporate social responsibility; Behavior; Integrated Corporate Reporting; Corporate Social Responsibility and Impact; Investment;


Serafeim, George. "Integrated Reporting and Investor Clientele." Harvard Business School Working Paper, No. 14-069, February 2014. (Revised April 2014.)