The Effect of Integrated Reporting on the Stock Prices of Publicly Held Banks: An Application in Borsa Istanbul

Today, non-financial information is highly sought-after by stakeholders of businesses. Accordingly, the accounting science had started communicating non-financial information together with financial information to stakeholders of businesses with the emergence of integrated reporting. The phenomena of integrated reporting, which is expected to add value to businesses, is still rather new in Türkiye and the publicly held banks are among the pioneers of integrated reporting. In this paper, we utilized the Ordinary Least Squares (OLS) estimator to test the effect of preparing integrated reports and the effect of published integrated reports on the stock prices and earnings per share of publicly held banks in Türkiye. The results of our analyses showed that preparing integrated reports has a positive impact on the earnings per share of publicly held banks, but not on their stock prices. Moreover, we found that published integrated reports have a positive impact neither on the earnings per share nor on the stock prices of publicly held banks. In conclusion, our findings suggest that integrated reporting does add value to publicly held banks in Türkiye, but the financial literacy of stock market investors must increase.