In 1994, King I was released (De Villiers, Hsiao & Maroun 2017a; Dumay et al. 2016). This first King code of Corporate Governance Principles introduced the incorporation of all stakeholders and largely focused on governance, particularly the desired conduct of the board of directors (Dube 2017). King II followed in 2002 with the suggestion of incorporating sustainability (environmental, social and corporate governance performance) and risk management in reporting (De Villiers et al. 2017a; Dumay et al. 2016; Scholtz et al. 2018), resulting in a number of entities including this in their AIR and others publishing separate sustainability reports with their AIR. Several years later, in 2009, King III was published to encourage an increase in accountability of companies to their various stakeholders (Ackers & Eccles 2015). It was accepted that existing guidelines were inadequate and disclosure modifications were necessary (De Villiers et al. 2014). The code proposed the publishing of an AIR that would holistically represent performance on both financial and non-financial matters (De Villiers et al. 2017a; Dumay et al. 2016), but this would be done on an ‘apply or explain’ basis (companies decide to either apply the principle, or explain to the users why it had not been applied [Giles 2017; Institute of Directors 2009]). The JSE subsequently mandated King III application for financial years commencing on, or after, 01 March 2010 and, consequently, South Africa became the first and only country to embrace integrated reporting principles on the ‘apply or explain’ basis (Appiagyei et al. 2018; Bernardi & Stark 2018; De Villiers et al. 2017a; Dube 2017; Eccles et al. 2019; Giles 2017; Hoang et al. 2020; JSE 2017). Certain principles became mandatory through the introduction of the new Companies Act, for example, establishing a social and ethics committee to comply with section 72(4). King IV is the latest development in the King code series. Published on 01 November 2016, it has changed from the ‘apply or explain’ basis to an ‘apply and explain’ basis with recommended practices on how to apply principles. The code refers to the IIRC framework with part 5.2 including recommended reporting practices, one being that an integrated report should be issued at least annually (Institute of Directors 2016). The JSE has mandated the application of King IV as part of their listing requirements effective for financial years commencing from 01 April 2017 (Giles 2017).

The Global Reporting Initiative was established in the 1990s to investigate sustainability issues and how progress and goals could be disclosed to stakeholders, consequently creating the first reporting framework in 2000, and periodically updating this, to arrive at the first global standards for sustainability reporting in October 2016 (GRI 2016; Scholtz et al. 2018). The GRI guidelines have a stakeholder focus similar to King III and IV (De Villiers et al. 2014), encouraging full presentation of both positive and negative aspects (GRI 2016). A number of countries, South Africa included, have companies that include sustainability reporting in their AIRs so that all information is holistically presented (Appiagyei, Djajadikerta & Xiang 2016; Hunter 2014), but due to the level of detail the GRI requirements specify, it was found that it can be problematic for readers to link the multitude of required information (De Villiers et al. 2014).

The increase in integrated reporting sentiments created a need for integrated reporting guidelines to be devised and, as such, the IIRC was formed in 2010 (PWC 2013) and it published an integrated reporting framework in December 2013 (Dumay et al. 2016). The principles-based framework (dissimilar to the rules-based GRI guidelines [Dube 2017; Dumay et al. 2016; Lee & Yeo 2016]) has more of a shareholder focus (providers of financial capital) with emphasis on strategy and information on future company plans for value creation, integrated into a single report, rather than stand-alone reports (De Villiers et al. 2014,2017a; Dumay et al. 2016; PWC 2014). The framework defines an AIR as:

Ultimately this illustrates that the aim of an AIR is to provide holistic information that shows a clear interrelation between financial and non-financial material (Dube 2017), leading to a broader and more cohesive presentation of a company’s performance, than the traditional financial and sustainability reporting and communicating of a full range of material factors that contribute towards a company’s value creation (De Villiers et al. 2014). Through the introduction of the eight integrated reporting content elements within the IIRC framework (IIRC 2013; Scholtz et al. 2018), AIRs have encompassed explanations on internal and external environments, forms of capital employed to create value, descriptions on how interactions with capitals and environments create value (Rinaldi et al. 2018), as well as social investment activities and how these link to strategy and value creation (Adams et al. 2016).

Having entered the integrated revolution stage (Dragu & Tiron-Tudor, 2013), the introduction of the aforementioned guidelines has had an impact on AIRs, with a surge of interest in research, following the King III release. Of the several studies within this sphere, content analysis was noted as the dominant research method. Numerous researchers used checklists to comment on the quality of the report and the compliance, with specific integrated reporting guidelines, rather than looking at the overrall picture of the AIR and many cover only a short time period; however, the majority conclude that there has been a positive impact on integrated reporting. These studies are summarised in Table 1.

Despite the apparent positive impact, concerns have still been raised that an AIR cannot provide all the necessary information needed by non-financial stakeholders, are lengthy, circumlocutory, incomparable (De Villiers et al. 2017a; De Villiers, Venter & Hsiao 2017b), complex and hard to understand (Du Toit 2017). There was a noticeable bias towards writing positive information to disguise negative information and make it less noticeable to readers through the use of the passive voice and making the narrative shorter and more complex (Du Toit 2017). Other findings have shown that companies are reducing clutter in their AIRs by summarising information and making full details available on other platforms such as their corporate websites (Du Toit et al. 2017; Nel 2019; PWC 2014).

The consulted literature has revealed that there have been many developments in the integrated reporting realm in South Africa, and despite this constant update in information, there is still an arena for growth on the topic and room to improve.

The Humanities and Social Sciences Research Ethics Committee of the University of KwaZulu-Natal has given full approval for this study to be conducted as a sub-study of the main study titled ‘An evaluation of corporate sustainability and financial performance for JSE listed companies in the food and drug retail sector’ (HSS/1271/018D).

Annual financial statements initially comprised the largest proportion of the AIRs (around half the AIR content in 2009, the lowest being Clicks at 43%) for all four companies. This proportion declined substantially in each company with the annual financial statement section showing the greatest variability evidenced by the largest standard deviations and the largest page range over the analysis period (refer Table 4). Figure 2 highlights the substantial decrease in annual financial statement content in the AIR for Pick n Pay in 2012 and 2016 onwards; Shoprite in 2013 onwards; Spar in 2017 onwards; and Clicks in 2012 and 2015 onwards. In these years, extracts from the annual financial statements were presented in the AIR rather than a full set of financial statements with selected notes to the financial statements being disclosed rather than the full notes. Further investigation revealed that the full set of financial statements for each company in those years was located in a separate document in the investor relations section of the respective company’s website in line with findings from Nel (2019). In 2018 Pick n Pay only presented two pages: one showing the statement of comprehensive income and the other the statement of financial position. In 2015, Clicks took the unique approach of only presenting their annual financial statements in a stand-alone document and not in their AIR, but still referred to such statements in their financial explanation sections with their AIR.

The number of pages occupied by reports ranged from 4 to 11 and, with the exception of Clicks, was consistently below 10% of the AIR each year. The consistency within the reports section is further supported in Table 4, reflecting the lowest standard deviation with a range of 4 (Spar and Clicks) and 7 pages (Pick n Pay and Shoprite) respectively. Each company presented a separate chairman’s report and chief executive officer’s report, except Spar that combined their chairman and chief executive officer’s reports into one, with the exception of years 2014, 2015 and 2016. There was no evidence into the reasoning for this combination, but it could have been done in an attempt to further summarise and de-clutter the AIR, as information could be repeated if separate reports were produced, but the choice does not appear to have had a material effect on the composition of the AIR. Shoprite showed an increase in page numbers in 2010 from 5 to 11 pages in which a 4-page chief operating officer’s report was also published.

Shoprite was the most consistent in their presentation of contents and pictures indicated by a standard deviation of only 0.789 in Table 4. It was observed that the number of pages in this section ranged from 5 to 7, and was below 10% of the AIR. The other three companies experienced more fluctuations in the contents and pictures section, evidenced by higher ranges and standard deviations (see Table 4a and Table 4b). The increase in page numbers mostly occurred as a result of more full-page images being presented in those years. Had different bases (such as the number of words or sentences) been used for the analyses, this observation would have gone undetected. A section explaining to users what the AIR contained, was introduced by each company. Shoprite, Spar and Clicks introduced this section in 2011, with Shoprite expanding the section to be more comprehensive in 2017 and 2018, while Pick n Pay introduced this in 2012. In 2010, Pick n Pay published a once-off tribute to Raymond Ackerman, the founder and ex-chairman of the board, as it was his retirement year.

Financial explanations mostly comprised 10% and less for the four companies. Shoprite was the most consistent in their financial explanations with the number of pages, ranging from 5 to 9 pages and a standard deviation of 1.135 (see Table 4). Additions to financial explanations coincided with the decision to change from presenting full annual financial statements to presenting extracts for both Pick n Pay and Shoprite. Pick n Pay’s financial highlights increased from 1 to 4 pages in 2016 and Shoprite introduced pro-forma financial information in 2017. Spar showed an increase in the percentage of financial explanations due to the introduction of a narrated financial review in 2013 that was presented annually thereafter. Clicks was the only company to display a decrease in the number of pages containing financial explanations. The decrease was evident as a result of no longer presenting a business unit trading analysis and value-added statement and presenting a shorter 5-year review after 2011. Although not impacting on the page composition, it was observed that Pick n Pay initially presented a 10-year financial review in the years 2009 through to 2011 and in 2012, moved over to presenting a 5-year financial review; Shoprite moved from a 5-year financial review to a 3-year financial review in 2017, while Spar consistently presented a 5-year financial review and uniquely presented ratios and statistics to users annually.

The analysis in Table 3 and Figure 2 illustrates that governance information presentation has tended to increase in volume, both as a percentage of the total report, and in number of pages for all four companies, with Clicks being the most consistent year on year evidenced by the lowest standard deviation (see Table 4). An upward trend was expected from the 2011 financial year end, due to the introduction of King III as a mandatory condition in the JSE listing requirements for financial years commencing on, or after, 01 March 2010 and ending on, or after, 28 February 2011. However, all companies were voluntarily applying King II in 2009 and once King III had been released, they began adapting disclosures and referring to King III in 2010 already. This being so, an upward trend was identified in Pick n Pay and Spar, but the number of pages did not increase dramatically. Shoprite’s increase only took place in 2012 and Clicks remained consistent. Pick n Pay saw their highest page numbers in 2014 and 2015, mainly as a result of all six board committees publishing reports in those years.

Table 5 divides the governance information further and indicates the different reports that were produced between 2009 and 2018. This additional analysis shows that many of the reports were consistent in nature between 2009 and 2018, with Pick n Pay showing more committee reports in 2014 and 2015. Both Pick n Pay and Clicks published an audit committee report annually, but ceased this publication in the AIR, following the shift in presentation of financial statements as explained in the annual financial statements section. Further investigation revealed that Pick n Pay disclosed their corporate governance, remuneration, audit and risk, as well as nominations committee reports in separate documents in the investor relations section of their company website in 2016, 2017 and 2018 in accordance with findings from Nel (2019). Spar initially reported a combined governance report containing all the committee reports until 2014 where the committee reports were shown individually thereafter. Spar originally had a combined remuneration and nominations committee and audit and risk committee which then divided into separate committees: the audit and risk committee divided in 2010 and the remuneration and nominations committee divided in 2016.

Holistically, the greatest increase in governance reporting in the latter of the analysis period stemmed from an increase in information in the remuneration committee report. Pick n Pay initially published a 3-page report which increased to 14 pages in 2017 and 19 pages in 2018; Shoprite’s report grew from 1 page in 2011 to 10 pages in 2018; Spar from 5 pages in 2017 to 12 pages in 2018; and Clicks from 5 in 2013 to 10 pages in 2017 and 2018.

Shareholder information provided in the AIRs has fluctuated from year to year for each of the four companies with no general trend. The maximum number of page numbers reflected in Table 4, for the shareholder section, was reported in 2011 for Spar, 2012 for Pick n Pay, 2014 for Shoprite (with 2012 being the second largest year) and 2013 for Clicks. Further analyses revealed that the spikes in Shoprite for 2012, Spar and Pick n Pay were due to the once-off presentation of the new memorandum of incorporation, following the introduction of the new Companies Act in South Africa comprising 18 pages for Spar, 16 pages for Pick n Pay and 26 pages for Shoprite. The 2014 spike for Shoprite and that of Clicks were due to a notice to shareholders regarding the annual general meeting and other special general meetings: 32 pages for Shoprite and 16 for Clicks.

Strategy and sustainability information has shown a general upward trend between 2009 and 2018 (see Figure 2). This upward trend could be explained by the introduction of the IIRC framework that indicated that ‘an integrated report should provide insight into the organisation’s strategy and how it relates to the organisation’s ability to create value’ (IIRC 2013:5) and GRI guidelines that promote publication of sustainability information. Certain anomalies were identified when analysing the trend more comprehensively. Shoprite showed a decrease in presentation from 2011 to 2016 when they minimised their detailed 24‑page sustainability report down to a summarised 5-page non-financial report. The company did increase presentation of strategic information, such as their business model, operating context and emphasis on how value had been created from 2017 through to 2018. Spar showed a general upward trend, mostly due to an expansion into Ireland in 2014, and Switzerland in 2016, resulting in more information on strategy, company profile, store formats and distribution centres, and more regions to report sustainability matters on. In 2017 and 2018 the strategy and sustainability information decreased from almost one third of the report to 15% due to Spar releasing their printable report as an abridged version in an effort to ‘go green’ and referring stakeholders to their website for further information in accordance with findings from Nel (2019). Clicks showed a decrease from 2013 to 2015 due to not publishing a sustainability report and presenting a lower number of pages in the operational review. The page numbers reverted to the higher numbers in 2016 when Clicks created a section titled ‘creating value through good citizenship’. It was observed that Pick n Pay showed two general jumps, one in 2015, due to a new section on strategic focus, and another in 2017 due to a section on material issues, risks and opportunities.

In Table 3 and Figure 2 the composition of all four companies’ AIRs between 2009 and 2018 have been summarised, with descriptive statistics in Table 4. While the composition of the reports varied year on year, and from company to company, numerous similarities in reporting trends were noted throughout the analysis.

As an overall analysis, the number of pages of the AIRs all peaked at a point and thereafter decreased. The comprehensive analysis of each reporting section revealed that the majority of this decrease was due to a common change in presenting annual financial statements in stand-alone documents on the relevant corporate website, rather than as part of the AIR. Both Pick n Pay and Clicks ceased presenting audit committee reports coinciding with their changes in financial statement display as the audit committee report formed part of the document containing the full set of annual financial statements. The second commonality identified amongst the four companies was the increase in governance information, mainly due to a longer remuneration report. The increase in information has likely stemmed from the early adoption of King IV principles. King IV only became effective for financial years, beginning 01 April 2017 and, therefore, for Pick n Pay this meant application for the 2019 financial year (financial year end February) and the 2018 financial year for Clicks, Shoprite and Spar. King IV was released in November 2016 and all of the companies had begun applying the King IV principles in their 2017 and 2018 financial years. All companies constituted a social and ethics committee in either their 2012 or 2013 reporting year in compliance with section 72(4) of the new South African Companies Act. There was a common consistency in the reports from key board members (Chairman and chief executive officer). The final commonality identified was an increase in strategy and sustainability information. In respect of three of the four companies (excluding Clicks), strategic information increased in the same year that the reports indicated application of the IIRC’s framework (2013 for Pick n Pay and Spar and 2017 for Shoprite).

Pick n Pay and Clicks showed similarities in their decreasing shareholder information and increase in contents and pictures. This was consistent with findings by Du Toit et al. (2017) who discovered a reduction in the volume of disclosure presented over their analysis period from 2012 to 2014. Both companies no longer presented their notice of their annual general meetings and proxy forms, as these were made available on the company website and both had an increase in full-page images. Pick n Pay displayed similarities with Spar in their financial explanations, with both increasing in 2013, due to the introduction of a narrated financial review. In the year that displayed increased shareholder information, Pick n Pay, Shoprite and Spar had disclosed their memorandum of incorporation in accordance with the new Companies Act. Clicks displayed this information in 2012, but rather than the full memorandum, they produced a three-page summary and referred shareholders to their website for further information; therefore, not making an impact on the volume of shareholder information provided.