Business model disclosure in the Strategic Report

What is it about?

The BM concept allows companies to illustrate their value creation process. Thus, it sheds light on some key aspects of the business that are not illustrated in the traditional financial reporting (i.e. intellectual capital). This paper analyses how companies disclose their business model (BM) in their annual reports, using a methodological framework specifically developed.

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Why is it important?

Despite intellectual capital (IC) information is increasingly considered necessary in investment decision processes, little significance is attributed to intangible reporting provided by companies. The analysis based on our analysis framework shows that only few companies use their BM disclosure to highlight the contribution of their IC to create and capture value. Such results point out some critical issues of BM disclosure and offers some hints useful for its regulation.