Jonathan Horner: “Beyond Boilerplate? An Analysis of the Effect of the ‘Section 172(1) Statement’ requirement on the reporting of FTSE 100 companies’.”

In Students by General Account

This project addresses the effect of statutory narrative reporting requirements on corporate disclosures. I am especially interested in directors’ statutory obligations to consider specific environmental and social impacts in their decision-making.   The Companies Act 2006 s.172(1) requires company directors to have regard in a number of ways for their stakeholders and society. This requirement emerged in light of increasing scrutiny of companies’ wider social impacts. There was however initially no requirement for companies to report on how they address the matters listed in the statute. A general sense emerges from the literature that reporting is as such little more than ‘boilerplate’.  In order to address this shortcoming, disclosure requirements were reformed in 2019. This project will investigate what effect, if any, this recent innovation has brought to the reporting of FTSE 100 companies across a range of sectors. The project’s significance lies in the question of whether regulation of disclosure has an effect on corporate narrative reporting and if so, how. I hypothesise that a measurable change occurred in s172(1) reporting when the new requirement was introduced.  Employing a Qualitative Content Analysis (QCA) method, the project will code FTSE100 annual reports to test for and understand the reformed disclosure requirement’s effects. The project will contribute to law and society scholarship by developing new knowledge, using QCA to build a dataset and then understanding corporate responses to legislative reporting requirements in general and those responses as they pertain to environmental and social conduct in particular.