Reputation Façade-Building through Non-Financial Disclosure: An Empirical Analysis of Gender Pay Equality Reporting

Currently, mandatory requirements concerning the reporting of non-financial information represent a major international trend in the field of accounting. While complying with related legislation and stakeholder pressure for more transparency, affected enterprises seek to gain legitimacy by building organisational fa & ccedil;ades. In doing so, they carefully select what information and how it is disclosed to the public. The goal of this paper is to investigate whether the related strategies are not only determined by the organisation-level variables but are also country-specific. In our study, we test this notion by investigating the impact of EU Directive 2014/95/EU concerning the disclosure of non-financial information on gender pay equality reporting in Germany and Poland. While the results of the panel analysis based on random effects ordered logit regressions confirm the expected significant effect of the Directive in both countries, we demonstrate that companies in Germany and Poland pursue different strategies concerning fa & ccedil;ade-building. Given the significant impact of the listing age of investigated enterprises on gender pay equality reporting and the varying history of sustainability reporting in the above countries, we argue that these strategies reflect the experiences with non-financial reporting predominant in different institutional environments.