Non-Financial Reporting by Banks in the Context of Current Development

The paper investigates the impact of the implementation of Directive 2014/95/EU nonfinancial reporting into Czech accounting regulations by evaluating the level and quality of non-financial reporting by banking institutions, including their foreign branches based in the Czech Republic. Information from the area Environment, Social and Governance are considered globally topical and relevant. They contribute to increasing competitiveness and responsible building of the future. The verification of level and quality of non-financial reporting was based on the comparison of the years 2016 and 2021, i.e., periods before and after the implementation of the directive. For the purpose of comparison, banking institutions were divided into three groups: banks with an obligation to report non-financial information, banks that are large accounting entities, and other banks. Key indicators of five basic areas of non-financial reporting were identified and the level of their reporting by banks was subsequently examined. The quality of the reported information was assessed using a point scale. The level of non-financial reporting in the sector of financial institutions in the Czech Republic was compared with the level of reporting in the Visegrad countries, Germany and France. By means of correlation and regression analysis, factors that influence the quality and level of non-financial reporting were identified, the most significant being net assets, gross loans to customers and Tier 1. It was also found that non-financial reporting is unsystematic due to the absence of a comprehensive methodology, mainly in the group of banks II and III. At the same time, the V4 countries report less non-financial information compared to Germany and France. A positive finding is the fact that there has been an increasing tendency in non-financial reporting in all monitored countries.