Business Model disclosure in mandatory and voluntary corporate reports: An empirical analysis

Driven by the increasing demand for external communication on how a business creates value, the theme of Business Model (BM) disclosure in mandatory and voluntary corporate reporting draws the attention of the academic community, accounting profession, and regulators. Despite this interest and the relevance that BM assumes both in financial reporting and in the specific regulations of non-financial information (e.g., UK Corporate Governance Code, EU Directive 2014/95), very little is still known about the BM disclosure practice. This paper examines the corporate BM awareness and disclosure by analysing the annual and voluntary reports of 86 publicly listed firms. We performed a computer-assisted content analysis to investigate corporate reporting practices and to verify the presence of the components of BM identified in the literature. The first results show a substantial knowledge of the concept of BM by the firms, but their reporting practice is unclear. Even though companies seem to be aware of their BM, very few reports provide users with a dedicated section to explain how they create value. Additionally, companies choose to disclose only some aspects of BM, hiding information related to the organisation of activities, their value proposition, and their future performance and strategy. The reporting practices are still anchored to old schemas with the prevalence of quantitative, financial, and historical information.