Board ownership, audit committees’ effectiveness, and corporate voluntary disclosures
Akhtaruddin M. and
Asian Review of Accounting, 2010, vol. 18, issue 3, pages 245-259
Purpose – The aim of the paper is to examine the linkages between board ownership, audit committees' (ACs) effectiveness in terms of the proportion of independent non-executive directors (INED) and expert members on the AC and corporate voluntary disclosures. Design/methodology/approach – The paper is based on a sample of 124 public listed companies in Malaysia for studying differences in corporate governance characteristics which affect the financial disclosure. Findings – The empirical results indicate that board ownership is associated with lower levels of voluntary disclosures. The result is consistent with the notion that board ownership increases agency costs resulting from information asymmetry between firm management and outsider investors. The negative relationship between board ownership and corporate voluntary disclosure is, however, weaker for firms with higher proportion of INED on the AC indicating that INED moderate board ownership/corporate voluntary disclosure relationship. Overall, the findings lend support for firms with a higher level of board ownership to include more independent directors on the AC to increase disclosure levels and reduce information asymmetry between firm management and investors. Originality/value – The paper demonstrates the usefulness of corporate governance factors mainly board ownership and effective AC on financial reporting practices. It is expected that this research will have important policy implication to reduce information asymmetry and improves corporate governance.
Keywords: Audit committees; Corporate governance; Disclosure; Malaysia (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
http://www.emeraldinsight.com/journals.htm?issn=13 ... 886024&show=abstract (text/html)
Cannot be freely downloaded
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:eme:arapps:v:18:y:2010:i:3:p:245-259
Ordering information: This journal article can be ordered from
Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
http://emeraldgroupp ... /journals.htm?id=ara
Access Statistics for this article
Asian Review of Accounting is currently edited by Dr Haiyan Zhou
More articles in Asian Review of Accounting from Emerald Group Publishing
Series data maintained by Louise Lister ().