Corporate reporting and governance are interlinked: Accounting and reporting inventions created the modern company, and without the modern company there is no entity from which to report. Due to its raison dâ€etre, reporting remained finance-centered, to protect financial capital providers. From the 1970â€s, the question of the interests of ‘stakeholders†emerged, with attempts of ‘social reportingâ€, ‘corporate social responsibilityâ€, ‘environmentalâ€, and ‘social and environmental†and finally ‘integrated†accounting and reporting. These trends are reflected also in the European Union legal framework, both in regulation of especially financial intermediaries and the ‘non-financial†reporting. This article is based on an extensive literature review, research conducted in the Sustainable Market Actors for Responsible Trade (SMART) project, and socio-legal and economic empirical research based conceptual analysis of the impact of these reporting systems and their relationship to financial accounting and reporting. The result of the research is that sustainability is reduced to focus on institutional investors and other members in the investment supply chain, and climate change issues only, and new regulatory solutions are required. Based on the most recent developments in EU law and in European jurisdictions, possible paths forward are envisaged to encourage sustainability in reporting and assurance, and through that, in governance. As an outcome a set of regulatory reform proposals are given based on the SMART recommendations. View Full-Text
