Preparing for integrated report: The Vietnamese enterprises need to improve the quality of annual reports

preparing integrated report, but it's too hard for us to do in the current stage and conditions. I think that in the future we will have to aim for all that but to do it we have to prepare a lot of other things” 109 Following to Nguyen (2015), the trade-off between costs and benefits related to corporate information disclosure has been discussed in various other theories which include legitimacy theory, stakeholder theory, political economic theory, agency theory, signalling theory, and proprietary costtheory. The author highlight that while the sociopolitical based theories (legitimacy theory, stakeholder theory, and political economic theory) explain differences in firms’ behaviours towards voluntary disclosure by using social and/or political factors; economic based theories (agency theory, signalling theory, and proprietary cost theory) explain the variations on voluntary disclosure by focusing on the firms’ wealth maximisation. Thus, the managers always consider the trade-off between the cost and benefits of disclosure (Nguyen, 2015). We agree with Nguyen and other authors, the tradeoff between costs and benefits is always considered when companies disclose information. Pham (2011) study of 30 listed companies Vietnam has shown that the high level of awareness of corporate social responsibility is not a factor in ensuring that enterprises fulfill and fulfill their social responsibility reporting obligations, but the perception of Vietnamese consumers and their procurement decisions have an impact on the implementation of social responsibility and disclosure obligations (Duc Hieu Pham, 2011). Pham and Do (2015) investigate the factors affecting the extent of voluntary disclosure by examining the annual reports of 205 listed industrial and manufacturing companies listing; evidence from that study suggests are companies with high foreign ownership have a high level of voluntary disclosure and the company size is an important factor related to the increased level of voluntary disclosure in annual reports of Vietnamese listed companies (D. H. Pham & Do, 2015). Another study by Dang (2018) for 289 listed Vietnamese firms found that there are three factors that influence the level of disclosure of corporate social responsibility information, sustainable development in the annual report of the enterprises are profitability, business size and independent auditing (Dang et al., 2018). However, this study does not have access to factors influencing the disclosure of corporate responsibility on the annual reports of Vietnamese listed companies. 5. Conclusions and policy implications 5.1. Conclusions Integrated report is a new trend in many countries, the benefits that integrated report brings to business is undeniable, especially in today's context as businesses are looking to sustainable development. Integrated report and sustainable development is still new concepts for the Vietnamese companies. Investors face many difficulties in finding information, evaluating and communicating with businesses on issues related to environmental, social and governance which is a initiative for promoting and implementing sustainable development of business. There are a number of issues that Vietnamese public companies need to accomplish in order to obtain an annual report in the true meaning of a complete, formal document that provides investors with an honest view of the status as well as the future of the business. 110 Vietnamese listed companies implement different regulations and as a result, the quality of annual reports among public companies is very different. It is easy to see that companies in the financial and banking sectors such as Bao Viet, Vietcombank, are highly internationalized and understand the value of the annual report so they make annual reports relatively professionally. Meanwhile, about 60% of public companies still do not pay much attention to the annual report due to the annual report is rather poor. There are many issues that public companies need to accomplish in order to obtain an annual report that is, in fact, a complete and official document on the state of affairs and the future of them. The quality of annual reports, a critical platform report for an integrated report, are still many problems need to be improved, especially the disclosure of social and environmental responsibility. The quality of corporate responsibility disclosure after the issuance of the Circular No.155/2015 has changed, however, the change is negligible, before the Circular No. 155/2015, the companies has disclosed responsibility information but focus primarily on local community support information. After the effective date of circular No.155/2015, they have disclosed additional information on ocial and environmental responsibility but the quality of information generally has no significant change. Companies need to be more aware of their responsibilities in making annual reports as well as better recognition of the benefits that annual reports bring rather than in accordance with legal obligations of the law. 5.2. Policy implications To address the above limitations, the state management agencies should study the promulgation of legal regulations on annual report, integrated report including regulations on increasing transparency, developing policies addressing environmental, social and economic issues, maintaining an understanding of regulations on performance measurement, reporting, monitoring, testing, and interpretation of information related to impact social, environmental and economic. In addition, it is necessary to strengthen the auditor's monitoring of the disclosure of information by enterprises. This is the factor that Dang (2018) study has shown to affect the level of disclosure of corporate responsibility information. The state should communicate well the benefits of disclosure of corporate responsibility for sustainable development. To exemplify typical enterprises, adopt preferential policies, encourage enterprises to disclose information fully with good quality. The state needs to penalty for companies disclosing incomplete information and recommendations to consumers and investors, handling sanctions if necessary in case of non- compliance with information disclosure. Issuing regulations of responsibility information disclosure need to combined with the obvious payoff when disclosure meet or not meet specified requirements. Continuing to maintain and further develop activities of selection the excellent annual reports to select and honor the enterprises to make good information transparency. This has always been a positive activity for businesses to be aware of information transparency, a 111 measure of market development through enterprise information transparency, governance quality, and information access of shareholders. Pham (2011) showed that the perception of Vietnamese consumers and their purchasing decisions have an impact on the implementation of corporate social responsibility and corporate responsibility disclosure obligations (Duc Hieu Pham, 2011). Therefore, the state management agencies and media agencies need to disseminate widely about responsibility of enterprises in information disclosure in order to raise consumer awareness, thereby influencing their purchasing decisions to influence enterprises to make them more accountable to the environment and society as well as the release of information related to the environment, society. Raising awareness of the business about improving the quality of annual reports to towards to implement integrated report in the future, such as: organizing more conferences relating to information disclosure; disclosing data about enterprises operating effectively, sustainable development which is contributed from the transparency and quality of information disclosure. Limitations of this study is only review a content related to general social responsibility disclosure of an annual report and does not cover all contents of annual reports. Evaluations of the quality of disclosures base on the subjective view of readers, who see annual report, that does not base on clear measurement criteria. 6. References Chau, G. K., & Gray, S. J. (2002). Ownership structure and corporate voluntary disclosure in Hong Kong and Singapore. . The International Journal of Accounting, 37(2), 247-265. Cooke, T. E. (1989). Disclosure in the corporate annual reports of Swedish companies. 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