Factors influencing voluntary corporate disclosure by Kenyan companies (original) (raw)
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Research Journal of Finance and Accounting, 2016
Corporate disclosure has been said to be very important as it increases the confidence of both shareholders and potential investors. This has led users of financial information to have intensified expectation for both statutory and voluntary disclosures to meet their needs. Since voluntary disclosures are based on the discretion of management, it is therefore necessary to examine whether corporate governance play a major role in voluntary disclosures. The purpose of this paper was to investigate the relationship between corporate governance and voluntary disclosure of firms listed on the Ghana Stock Exchange. The study investigated 31 firms using dynamic panel data from 2005 to 2015. It was evident that current disclosure is influenced by past disclosure indicating a trend in voluntary disclosure overtime. The study revealed that board compensation, board gender diversity and ownership structure have a statistically significant positive relationship with the level of voluntary discl...
Corporate Boards, Ownership Structures and Corporate Disclosures: Evidence from a Developing Country
Purpose: This paper investigates the effect of corporate board attributes, ownership structure and firm-level characteristics on both corporate mandatory and voluntary disclosure behaviour in annual reports of Libyan firms. Design/methodology/approach: Multivariate regression techniques are used to estimate the effect of corporate board and ownership structures on mandatory and voluntary disclosures of a sample of Libyan firms between 2006 and 2010. Findings: Our results are as follows. First, we find that board size, board composition, the frequency of board meetings and the presence of an audit committee have an impact on the level of corporate disclosure. Second, this study finds an evidence that director ownership, foreign ownership, government ownership and institutional ownership have a non-linear effect on the level of corporate disclosure. Finally, we find that firm age, liquidity, listing status, industry type and auditor type are positively associated with the level of corporate disclosure. Limitation: Future research could investigate disclosure practices using other channels of corporate disclosure, such as corporate websites. Useful insights may be offered also by future studies by conducting in-depth interviews with corporate managers, directors and owners regarding these issues. Implication: Investors may also rely on such corporate governance characteristics to shape expectations about voluntary and/or mandatory information disclosure. Originality/value: Existing disclosure studies have mainly examined governance and voluntary disclosure relationship in non-listed firms. Our study, therefore, extends, as well as contributes to the existing literature by the examining the governance-disclosure nexus relating to both mandatory and voluntary disclosures in both listed and non-listed firms. Keywords: Corporate governance; Board and ownership structures; Corporate disclosure behaviour; Multi-theoretical perspective.
2014
In every organisation, managers act as stewards of the company resources for the owners of the company. As such they report regularly to the owners on the company"s performance disclosing the statutorily required information as regulated by various authoritative bodies. Managers in their reporting disclose information beyond requirements such as generally accepted accounting principles where the information is believed to be relevant to the decision-making of users of the company's annual reports. Voluntary disclosure is carried out by many companies, although the extent and type of voluntary disclosure differs by geographic region, industry, and company size. This study sought to establish the effect of voluntary disclosures on stock returns of firms listed at the Nairobi Securities Exchange. Through content analysis of annual audited financials reports of companies in the banking and construction and allied industries, the study sought to establish the effect of voluntary disclosures such as; business data, analysis of business data, forward-looking information and information about management and shareholders, background about the company and information about intangible assets on stock returns. The results obtained from the model indicate that voluntary disclosure of firm"s information has positive impact on stock return. Disclosure on business data, forward looking information, background about the company and information on intangible assets not disclosed in the financial statements positively impact on the firm"s stock returns. However, information on management analysis of business data and information about management and shareholders has negative implication on company"s stock return. vi
2015
In the last few decades, the problem of voluntary disclosure of financial or non-financial information has been in the attention of many researchers. Shareholders, investors and other stakeholders make their investment and financial decisions on the basis of the information they get from annual reports. These annual reports may contain both mandatory and voluntary information. These voluntary disclosures are done by managers in the spirit of openness and transparency and may contain vital information that may assist all interested parties to make wise decisions. This paper sought out to examine empirically the relationship between voluntary disclosures and financial performance measure, Return on Investment (ROI), of companies quoted at the Nairobi Securities Exchange. Annual reports of 10 listed companies from the NSE 20-share index were investigated from the year 2011-2013. A disclosure checklist consisting of 49 voluntary disclosure items of information was used. A regression ana...
Discretionary Disclosure of Listed Non‑Financial Firms in an Emerging Market: Evidence from Ghana
Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis
The main objectives of this study are to measure the extent of voluntary disclosure of listed non‑financial firms in Ghana. The paper also seeks to identify the corporate governance attributes that influence voluntary disclosure, and finally, it rated the importance of voluntary items in the annual reports from the viewpoint of investors in Ghana. The paper makes use of 2013 to 2016 annual reports for 17 firms. The corporate governance attributes examined are board size, the proportion of independent non‑executive directors on the board, blockholder ownership and the audit committee. Five control variables were also used to support the study. We developed a total of 66 voluntary items. Both the simple frequency distribution and Stata software were employed to analyze the data. The findings revealed a mean of 32.7% as the level of voluntary disclosure. Board size, block holder ownership and audit committee had a positive association but only board size was statistically significant. ...
Through annual reports, the company provides a lot of voluntary information which is very vital to stakeholders and in corporate governance. The main objective of this study is to empirically investigate the impact of corporate governance on voluntary information disclosures of quoted companies in Nigeria using data from 385 annual reports from a sample of 35 quoted companies during 1999 -2009. The study also adopted Pre and Post approach to study the significant difference on information disclosures during pre and post corporate governance codes era in Nigeria. A content analysis of the annual reports of sampled companies was carried out with the use of a disclosure checklist developed by the researcher. Multiple regression is employed to test the hypothesis of the study. The study reveals that corporate governance has significant impact on financial reporting of quoted firms in Nigeria and that the level of voluntary disclosure has significantly improved after the introduction of corporate governance codes in Nigeria.
African J. of Accounting, Auditing and Finance, 2015
Prior studies have investigated the determinants of discretionary disclosure in a number of organisations. However, very few studies have investigated the determinants of discretionary disclosure by cooperatives in a developing country. This study investigates the determinants of voluntary disclosure practices by savings and credit cooperatives (SACCOs) in Kenya, a developing country with a vibrant credit union sector. Using a sample of 212 deposit-taking SACCOs in Kenya over a six-year period between 2008 and 2013, the study finds that voluntary disclosure practices in SACCOs are largely shaped by governance, asset quality, proprietary and regulatory forces. The study provides important implications on the need for SACCOs to improve voluntary disclosures in a developing country context.
Business Case for Corporate Transparency: Evidence from Kenya
European Journal of Business and Management, 2013
With increasing trend of corporate scandals and corporate failure, stakeholders are demanding access to information, transparency and accountability. In response to these demands, corporate governance guidelines all over the world prescribe for corporate transparency and disclosure of information especially among public listed firms. Drawing from agency theory and stakeholder theory, we argue that corporate boards have a responsibility to disclose material information to stakeholders in order to facilitate decision making and hence improve firm performance. This study investigates business case of corporate transparency in Kenya. Applying Fixed Effects regression model on data from 42 listed firms in Nairobi Securities Exchange for the period 2005-2010, we found that indeed corporate transparency has a positive and significant effect on firm performance. The results have important policy implications on corporate disclosures in Kenya.
SAGE Open
This research examines corporate governance disclosure in Nigerian and South African Banks using the unweighted disclosure index technique. This research provides a cross-sectional examination of corporate governance disclosure practices in the annual reports of listed banks in Nigeria and South Africa. The results suggest that Nigerian and South African banks have a high level of corporate governance disclosure. However, Nigeria and South African banks have low levels of voluntary corporate governance disclosure. Furthermore, in reporting of voluntary corporate governance disclosure, Nigerian banks appear to be collating information with no link to the overall business strategy of the organization while the South African banks have a more robust approach to voluntary corporate governance disclosure as they apply international guidelines such as the Global Reporting Initiative to their disclosure.
Corporate Governance Disclosure in Nigerian Listed Companies
Social Science Research Network, 2018
Corporate Governance Disclosure (hereafter CGD) is the extent to which an organization transparently discloses its governance practices and strategies to stakeholders (UNCTAD, 2011). This paper aims to examine the impact of corporate governance disclosure on firm performance, board composition, and company size. To achieve the research aim, this study used secondary data from companies listed on the Nigerian stock exchange and examined 31 companies across 5 sectors from 2010-2013. This paper adopts theoretical triangulation (Golafhani, 2003; Carter et al., 2014) to provide a wide and deep understanding of the topic with the aim of both contributing to the literature and providing insights on how compliance can influence current governance practice in Nigeria. This study used panel regression techniques and the results indicate that asset turnover, board composition and number of employees are all significantly related to corporate governance disclosure. However, return on assets, return on equity and earnings per share are not significant. Overall, this study found that listed companies compliance with the Securities Exchange Commission (SEC) Disclosure requirements has a positive influence on corporate governance performance for the firms listed in the Nigerian Stock Exchange.