Amid growing global attention to sustainability reporting, this study explores the voluntary adoption of Integrated Reporting (IR) and its relevance in financial markets. Despite increasing mandatory nonfinancial disclosure requirements, full integration of financial and sustainability information remains voluntary, particularly in the European Union (EU), where corporate reporting is undergoing significant transformation. Using a sample of 133 companies listed in the IIRC’s IR Examples Database and other sources, this study analyze the association between IR release and financial analysts’ forecasts, focusing on forecast accuracy and dispersion across diverse institutional settings. Results reveal that IR informativeness varies significantly by country: in strong institutional enforcement contexts, IR release improves analysts’ forecast accuracy, while its impact in weaker contexts is limited. Additionally, IR is consistently linked to reduced forecast dispersion, indicating greater consensus among analysts.These findings highlight the moderating role of institutional frameworks in determining IR's value for financial markets and underscore the necessity of regulatory measures to either mandate IR or strengthen institutional contexts. The study also offers insights into the potential effects of the EU’s proposed revisions to the 2014 Directive on nonfinancial information, which aims to introduce mandatory reporting and standardized frameworks, thereby enhancing comparability. The study suggests that these changes will elevate the significance of voluntary sustainability reporting, benefiting capital markets through improved analyst predictive capabilities. The study has implications for corporate managers, policymakers, and regulators, emphasizing the strategic importance of IR and the need for harmonized nonfinancial reporting standards. Research limitations and avenues for future exploration are also discussed.
