This article contributes to the debate on the use of performance information in the context of public sector performance management. Based on case studies, the authors analyze the appropriateness of the performance information provided in the newly established performance budgets of municipalities in Germany and Italy. They also examine the interest of politicians and senior managers in using such information for decision-making and monitoring within the municipal budget cycle. They find that the use of performance information is generally quite modest, and that the interest of different local actors varies to a great extent. Politicians are generally less interested in such information than top managers, particularly chief financial officers. The results are discussed by applying a theoretical framework based on institutional and legitimacy theories, and are compared with the literature on performance information use.

Given the current undefined relational effect between corporate financial performance (CFP) and corporate social performance (CSP) and the potentially myopic behavior of managers, this paper answers the call from some scholars to contribute towards a better understanding of the relationship between CFP and CSR. Different from other papers, it does so by analyzing the role of innovation activities as a mediator between CFP and CSR, applying a regression and mediation analysis between firms’ financial resources, innovation initiatives, and social and environmental performance. The results demonstrate that innovation is a critical factor in the relationship between CFP and corporate social performance (CSP) as it enables organizations to respond to new economic, social and environmental challenges faster and better than organizations that are not able to innovate. Therefore, the investment of financial resources in innovation initiatives is one of the most important levers to pursue and to increase CSP.

Purpose: This paper aims to present a deep understanding of how social media affects organisations’ sustainability performance, using environmental, social and governance (ESG) factors. Particularly, this paper assumes the existence of a causal relationship between organisations’ sustainability performance and the use of their social media profile (i.e. Twitter). Design/methodology/approach: The authors used a multivariate regression with an explorative approach. Using Thomson Reuters Eikon, the authors composed a sample of 115 public EU companies with a headquarter in Europe operating in the “energy” and “utilities” sectors. The authors collected ESG-related, financial and Twitter-related data covering the period 2016–2019. Findings: The study findings emphasise the existence of a statistically significant and positive relationship between social media profiles (i.e. Twitter) and companies’ sustainability performance. Findings show that ESG-oriented companies use their Twitter profile more as a tool for achieving a higher level of legitimation rather than for managing their sustainability strategy and related performance. Therefore, social media contribute more to the construction of companies’ CSR identity than the management of analytic aspects of sustainability performance. The longevity of companies’ profiles is the variable mostly showing a causal relationship not only with the general measure of companies’ sustainability performance but also with its pillars and sub-pillars. Originality/value: This research is original in showing academics, practitioners and policymakers results on the impact of different modalities of interaction (retweets, replies, likes and quotes) between organisations and stakeholders by using social media on sustainability performance.

IMPACT Auditing fulfils a public interest role for public spending, which is important to underpin the state and democracy. However, public sector auditing is under increasing public scrutiny and political pressure, especially following crises that challenge public finances including at state and local level. This article provides a comparative analysis of the development of auditing practices in governments internationally at both local and state level. To do so it analyses themes of ‘organization and fragmentation’, ‘independence and competition’, ‘audit scope’, and ‘inspection/performance assessment’. This will help inform academics, policy-makers and practitioners of contemporary practice to improve their own regulatory space.

Purpose: This paper investigates whether and how Directive 2014/95/EU affects financial performance as well as its moderation effect on the relationship between financial and non-financial performance, involving different stakeholders' perspectives.Design/methodology/approach: We adopted the panel data approach to perform random effects regression analysis on a sample of 435 European listed non-financial companies, considering a timeframe of six years. Furthermore, the moderation effect of the Directive 2014/95/EU on the relationship between financial and non-financial performance has been tested.Findings: NFD regulation negatively affects firms' operating profitability and shareholder value while produces no effects on debtholders' returns. Nevertheless, the Directive 2014/95/EU has general positive moderating effects on the relationship between non-financial and financial performance, mitigating the direct costs induced by pursuing non-financial performance.Research limitations/implications: Shifting from mimetic to coercive isomorphism caused a strengthening of the complementarity between financial and non-financial performance dimensions, extending the concept of performance itself. The analysis carried out is limited to a short-term timeframe and on non-financial companies subject to the Directive 2014/95/EU.Practical implications: The paper highlights trade-offs between the costs induced by non-financial activities and the benefits of being compliant with the non-financial disclosure (NFD) regulation, supporting managers in allocating business resources.Originality/value: This paper is among the first that investigates the impact of mandatory NFD on the relationship between non-financial and financial performance. It is also one of the earliest in finding some pieces of evidence on the direct impact of Directive 2014/95/EU on EU companies' financial performance.

Financial accountability is a major issue for State-owned Enterprises (SOEs) especially because of the large amount of public resources invested in them and the social relevance of their performance. In the awareness that the public interest is increasingly pursued in abstract arenas, the investigation of accounting should be anchored to conceptual rather than contextual spaces. Building on the dimensional concept of publicness, this paper investigates the impact of three publicness dimensions (ownership, political control, and goal ambiguity) on earnings management (EM) in SOEs, a managerial practice that affects the quality of financial accountability. Drawing on data from a sample of 1200 Italian SOEs, the conditional revenue model (Stubben, 2010) is used to estimate their EM during the period 2009–2017. These EM estimates are then regressed against dimensions of publicness. Findings show that publicness is either neutral or relevant for the quality of SOEs’ financial accountability, depending on the dimensions analysed: while ownership and financial control are positively related to EM in SOEs, administrative control and goal ambiguity are not statistically significant predictors of EM. Moreover, the interaction of publicness dimensions does not affect EM in SOEs. Therefore, this paper shows that SOEs’ publicness is either irrelevant or detrimental to the quality of SOEs’ financial accountability, depending on the dimension of publicness considered. Efforts should be made to define policies and governance arrangements able to influence managers’ behaviour in a way that preserves SOEs’ financial accountability.