Human Resource Accounting

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Research and Methodology

This chapter begins by describing the research approach and choice of method in order to create understanding on how the selection process and data collection have been handled. The chapter’s final section will highlight method details on the variables and finally a critical discussion of the selected method.

Research method

fulfil the purpose of this paper, a combination of quantitative and qualitative research approach has been used in order to conduct an adequate research. Saunders, Lewis and Thornhill (2012) argues that a combination of these methods is applicable when the purpose is to gain a deeper insight of revealed information. The disclosed information in the corporate annual reports has been transformed into numbers to be able to compare the annual reports and the data has been compiled into a disclosure index. This method has been applied in order to investigate how much information there are concerning HC over a period of time in corporate annual reports. Bukh et al. (2005) argues that a disclosure index, is a tool to demonstrate the scale of what the corporate annual reports reveals. Nielsen, Rimmel and Yosano (2015) means that the disclosure index methodology consists of a calculation of related items disclosed in the corporate annual reports based on a predefined list of items.
In this paper, annual reports from companies listed at OMXS30 has been scrutinized over a timespan of five years (2010-2014). The latest annual reports that were available for this research was the reports with financial year 2014. This since the reports with financial year 2015 are released in April/May 2016, and the collected data for this research was conducted in March 2016. In order to appropriate answer the third research question in this paper: what are the differences in HC disclosure between integrated- and GRI reports? have not the empirical results from 2010 and 2011 been in consideration for this question. This since the IR framework is newly adopted, mainly in 2011 and 2012 by the selected companies in this study. The information that are disclosed in the company´s annual reports are a mix of voluntary and mandatory information. In order to get a more detailed and structural picture of the information in the corporate annual reports, this paper has in accordance to Bukh et al. (2005) established description of the use and methodology of the disclosure index. This method has been used by similar studies in this field (Bukh et al., 2005; Nielsen, Rimmel & Yosano, 2015).

The disclosure index – Checklist for Human Resource

This paper has applied a disclosure index for the quantification of information levels disclosed regarding HC in the annual reports for companies listed at OMXS30. The method used in this paper has followed a common path of previous studies which has used a disclosure index (Bukh et al. 2005; Nielsen, Rimmel & Yosano, 2015). When applying a disclosure index, it is of importance to consider the reliability of the results and the objectivity of the study (Bukh et al., 2005). In this paper, this criticism is handled through an accurate literature review, distinct information regarding the coding process and the collection of data. According to Bukh et al. (2005) there are no widely accepted theoretical guidelines for selecting items in a disclosure index. In order to create a successful index, it is therefore of importance to be critical and cautious during the selection of items. Beattie, McInnes and Fearnley (2004) criticizes that the amount of disclosure items could not be an exact indicator of disclosure quality within the corporate reports. Despite this, Bukh et al. (2005); Guthrie et al. (2004) suggest that disclosure index is a fruitful way for future research into voluntary disclosures in business reporting. The focus of this paper is HC disclosures and the selection of items in the applied disclosure index are based thorough inspection of IR- and GRI framework as well as previously studies regarding HC (Bukh et al., 2005; Nielsen, Rimmel & Yosano, 2015; Huang et al., 2013).

The design of disclosure index

In this paper the contents of each annual reports regarding HC were scrutinized by comparing the revealed information by using a disclosure index. A simple binary coding scheme was coded, were revealed information that was disclosed scores 1 while no disclosure of information scores 0. This method has been used in previous researches in this field (Rimmel, 2003; Beattie, McInnes & Fearnley, 2004; Bukh et al. 2005; Nielsen, Rimmel & Yosano, 2015). In the quote below, a statement has been disclosed regarding an employee’s survey in ASSA ABLOY AB:
“The ASSA ABLOY Employee Survey is an efficient means of finding out what employees think about their work situation, how they perceive ASSA ABLOY as an employer, how they perceive health and safety in their workplace, and whether they consider they are given equal opportunities. The survey is carried out every 18–24 months. The results are broken down into over 275 workplaces to enable concrete action plans relevant to employees. The most recent survey took place in March 2012 and almost 28,000 employees responded. The 2012 results show a slight improvement in all areas compared to the previous survey (2010). A new survey will be conducted in February 2014”.
(ASSA ABLOY, Annual Report 2013; p. 60-61).
The selected paragraph in the quote above has met this papers requirements for disclosed information regarding the item employee’s survey (HC18, see table 2). Points have been given since the statement from ASSA ABLOY mentions there has been an employee’s survey and what the result shows. In the next quote, an example is shown of a statement that has result in 0 points for the same item, employee’s survey, in Swedish Match AB:
“The HR organization regularly coordinates and conducts a global employee survey to identify common improvement areas. Following the presentation of the results, employees and managers develop action plans together based on the survey results. The most recent survey was conducted in eight countries and provided in seven different languages. A total of 88 percent of all employees participated. The survey measured levels of employee engagement, satisfaction, and employer attractiveness and evaluated communication effectiveness and other areas critical to the performance of the Company, such as leadership and management capabilities”.

1. Introduction 
1.1 Background
1.2 Problem discussion
1.3 Research question
1.4 Purpose
1.5 Delimitations
1.6 Thesis outline
2. Frame of References 
2.1 Human Resource Accounting
2.2 Global Reporting Initiative
2.3 Integrated Reporting
2.5 Stakeholder Theory
2.6 Disclosure Theory
3. Research and Methodology
3.1 Research method
3.2 The disclosure index – Checklist for Human Resource
3.3 The design of disclosure index
3.4 Data collection
3.5 OMX Stockholm 30
3.6 Integrated Reporting at OMXS30
3.7 Quality of Method chosen
3.8 Critical Discussion
4. Empirical results 
4.1 The total scoreboard of companies at OMXS30
4.2 The total scoreboard of IR- and GRI companies
4.3 Training related disclosures
4.4 Employees related disclosures
4.5 Health and safety related disclosures
4.6 Work related disclosures
4.7 Board of directors related disclosures
5. Comparison and Analysis 
5.1 HC disclosures in OMXS30s corporate annual reports
5.2 HC disclosures development in corporate annual reports
6. Conclusion 
6.1 Main findings and conclusions
6.2 Comments and discussion
6.3 Ethical and Societal impact
6.4 Implications for further research
7. References
Human Capital Disclosure in Corporate Annual Reports

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