Corporate anti-corruption disclosure and earnings management: evidence from East Africa community

Peter Nderitu Githaiga

Journal of Financial Crime, 2024, vol. 32, issue 3, 603-619

Abstract: Purpose - Corruption and earnings management remain a serious concern across the globe. In addition, corporate disclosure of anti-corruption practices is still in its infancy in developing and emerging countries. Therefore, the purpose of this study is to examine the effect of anti-corruption disclosure (ACD) on earnings management (EM) among listed firms in the East Africa Community (EAC) partners states. Design/methodology/approach - The study used an ACD check list developed from recent studies and the Global Reporting Initiative (GRI-205) standard on anticorruption reporting. The sample comprised 58 firms listed across EAC partner states stock/securities exchanges over the period between 2013 and 2022. The hypothesis was tested using the ordinary least squares (OLS) method. Findings - This study found low level of ACD among the selected firms. The regression results revealed a negative relationship between ACD and EM. The results are robust to alternative panel data estimation methods and a proxy measure of EM. Originality/value - To the best of the author’s knowledge, this is the first paper that empirically examines the effect of ACD on EM in the EAC, thus making a contribution to the existing literature.

Keywords: Anti-corruption disclosure; Earnings management; East Africa community; Listed firms (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfcpps:jfc-01-2024-0016

DOI: 10.1108/JFC-01-2024-0016

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