Is Mandatory Non-financial Reporting an Effective Regulatory Strategy for Advancing Responsible Business Conduct?: Observations on Human and Labour Rights Reporting in Denmark 2008-2018

Through a contents analysis of reporting in Denmark during 2008-2018, this article examines the transformational effect of mandatory NFR as a regulatory strategy. Based on a pilot study, the article contributes to the legal and organisational literature by exploring the under-researched issue of the effect of mandatory NFR as a regulatory strategy to advance responsible business conduct by stimulating organisational transformation. NFR is typically viewed from an informational perspective, concerned with providing investors and other stakeholders with data relevant to their decisions concerning the company, or a transformational perspective, targeting internal learning and focused organisational change. The article provides novel understanding of the dynamics of a transformational approach based on stimulating organisational learning, as well as the effects of shifting to a disclosure orientation following the implementation of the NFRD. Based on the empirical analysis it concludes that the learning objective as well as the manner in which a NFR requirement is communicated in a legislative text or supporting guidelines are significant for the transformational potential and therefore regulatory effects of NFR.