Impact of Corporate Ownership on Non-Financial Risk Disclosure in a Developing Country: Moderating Effect of Companies Act 2015

Erastus Mbithi (), Tankiso Moloi () and David Wang’ombe ()
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Erastus Mbithi: Strathmore University
Tankiso Moloi: University of Johannesburg
David Wang’ombe: Strathmore University

A chapter in Rethinking Management and Economics in the New 20’s, 2023, pp 145-171 from Springer

Abstract: Abstract This study investigates the relationship between ownership structure and quality of non-financial risk disclosure (NFRD). Further, it examines the moderator effect of the Companies Act 2015 on this relationship. We collect data over twelve years from companies listed on the Nairobi Securities Exchange (NSE) in Kenya. Content analysis is used to measure NFRD and fixed-effect regression to test the hypotheses. The results indicate that quality of NFRD is low and highly dispersed across the sampled firms. The regression results suggest that block ownership, foreign ownership and institutional ownership are associated with NFRD, whilst managerial ownership and government ownership are not associated with NFRD. In addition, institutional ownership, foreign ownership, and government ownership are moderated by the Companies Act 2015, whilst managerial ownership and block ownership are not moderated. The finding highlights the importance of ownership structure in enhancing the quality of NFRD. The finding will be useful to regulators and policymakers when developing, reviewing and enforcing NFRD guidelines.

Keywords: Quality of non-financial risk disclosure; Ownership structure; The companies act (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-981-19-8485-3_6

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DOI: 10.1007/978-981-19-8485-3_6

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