Non‐disclosure of human capital‐based information: theoretical perspectives

Purpose – The purpose of this paper is to discuss a framework of accounting theoretical bases that could promote research into little understood areas of human capital accounting. Design/methodology/approach – The possible forces that hinder greater disclosure of human capital‐based information are analyzed by reviewing several theoretical viewpoints that offer a framework of different possible reasons for the low frequency of human capital‐based disclosures. Findings – The paper explores several possible reasons for the reluctance of firms to disclose greater amounts of human capital‐based information, from the perspective of relevant theoretical bases. The predominant reasons may differ in different circumstances, industries and environments. Research limitations/implications – The paper explores theoretical bases that explain the barriers to widespread reporting of human capital‐based information. The theoretical bases discussed are not empirically validated. Practical implications – The validation of the theoretical bases explored in this study, and the possible uncovering of new bases in the future through empirical studies, will enable academics, policy makers and accounting standard setters to better understand the reasons for the limited disclosures of human capital‐based information by listed firms to capital markets. This will help in the promulgation of widely accepted accounting standards for the disclosure of human capital‐based information, which address and overcome the forces that currently hinder the reporting of human capital‐based information. Originality/value – This is the first paper that explores a framework of several pertinent theoretical viewpoints that specifically address the non‐disclosures of human capital‐based information to capital markets.