Intellectual Capital Reporting in the Italian Non-Profit Sector. An Image-Building or an Accountability Tool?

The purpose of this article is to analyze intellectual capital (IC) measurement,management, and reporting practices at organizational level,with the aim to address a relevant research question: are IC reports usedas accountability or as image-building tools? The article presents a singlein-depth case study of an Italian nonprofit organization (NPO) whichhas been measuring and reporting its IC for several years. The research project was conducted using an interpretative approach, by analyzingorganizational IC reports in the light of a framework, derived fromcorporate social responsibility (CSR) and IC literature, able to provideresearchers with useful insights to interpret the role played by IC reportin the investigated organization. The lenses provided by the designed frameworkgive researchers the opportunity to offer a skillful interpretationof the information provided by the IC report. From the analysis, it resultsthat the investigated NPO use IC report more as a managerial ratherthan an accountability tool. Even though the use of a single case studyprovides in-depth and rich data, it also limits the generalizability of theobservations to other companies. Moreover, the results obtained can beinfluenced by the model built and adopted to address the research question.The findings can support companies to enable IC reporting practicesand readers to understand the orientation of the companies towards areputation or an accountability approach by reading the IC report usingthe research model. The article fills a gap in the research of voluntarydisclosure of NPOs from a different approach (i.e., to analyze IC reportsto make evident the approach followed in disclosing IC information). Sodoing, the article contributes to narrowing the gap between IC theory andpractice and offers new insights on the reasons why NPOs disclose IC.