Board Directors’ Expertise and Corporate Corruption Disclosure: The Moderating Role of Political Connections

Md. Abdul Kaium Masud, Seong Mi Bae, Javier Manzanares and Jong Dae Kim
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Md. Abdul Kaium Masud: Department of Sustainability Management, Inha University, Incheon 22212, Korea
Seong Mi Bae: College of Business Administration, Inha University, Incheon 22212, Korea
Javier Manzanares: Department of Sustainability Management, Inha University, Incheon 22212, Korea
Jong Dae Kim: College of Business Administration, Inha University, Incheon 22212, Korea

Sustainability, 2019, vol. 11, issue 16, 1-22

Abstract: Professional expert directors extensively influence corporate corruption disclosure (CCD), while higher political connections may exacerbate corporate management. This study investigates the relationship between the presence of external experts on a board and CCD, as well as the moderating effect of political connections, on the positive role of legal experts in CCD. The study combines agency, resource dependence and stakeholder theories to show how resourceful directors on the board can promote corruption disclosure. Using data on listed firms in the Bangladeshi financial sector, the study analyzes 247 firm-year observations from 2012 to 2016. The results of a multiple regression analysis indicate that accounting experts, legal experts, political connections and corporate media visibility each have a positive and significant influence on CCD. Moreover, the moderating effect of political connections on the relationship between legal experts and CCD is negative and significant due to their higher political influences. The study has significant implications for corporate governance and for policies concerning the development of the economy while reducing corruption.

Keywords: corruption; bribe; accounting expert; legal expert; politics; disclosure; Bangladesh (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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