Trust and intellectual capital reporting in Italy: A longitudinal perspective

In the last two decades, Intellectual Capital (IC) reporting has experienced a “rise and fall” process. More in depth, after the initial academic and professional enthusiasm, several scholars and practitioners have raised questions about whether IC was something relevant or just a managerial fashion. Some recent studies have investigated the reasons underlying the demise of the IC reports (Chiucchi and Giuliani, 2017; Chiucchi, et al., 2016, 2018; Giuliani and Chiucchi, 2019; Nielsen, et al., 2017; Tee Jeok Inn, et al., 2015). Some argue that a relevant issue to understand if a business reporting practice will be adopted and maintained or rejected is trust (Chaidali and Jones, 2017). In fact, as the implementation of a new business reporting practice is subject to managerial discretion, it is important to focus on preparers' trust in the “new” reporting tool. The purpose of this paper is to analyse the IC reporting experience to understand the role of trust in determining the parabola experienced by IC reporting. In other words, the study aims to understand whether and how the IC reporting issues managed to gain and, in several cases, lose the trust of the preparers’. In order to achieve this aim, the results of an exploratory field study conducted through semi-structured interviews referred to Italian companies will be presented. The social theory of trust (Sztompka, 1999) will be used to understand how the trust on IC reporting was built by the Italian IC scholars and practitioners involved in the field and why it remained or faded over time. This paper contributes to the existing literature answering the call for more follow up studies about IC reporting. Consequently, this paper contributes to the understanding of the reasons underlying the rise and fall of IC reporting and the future of IC research. In addition, the results achieved can contribute to understanding to what extent trust can influence the “fate” of a business reporting initiative. In comparison to the extant studies, this study is not focused on single or few cases but it offers insights collected from several organisations in order to have a broader view of the IC experience. In addition, by adopting a longitudinal perspective, from the first implementation up to date, our research does not offer a “snapshot”, i.e. referred to a specific moment, of the role played in taking up and in continuing or abandoning these practices. Finally, the Italian case, which presents some peculiarities if compared, for example, to the Danish one, offers also the possibility to identify different levers/obstacles related to the different genesis of the adoptions of IC reports.