Exploring the relation between corporate reporting and corporate governance effectiveness

Maali Kachouri and Anis Jarboui

Journal of Financial Reporting and Accounting, 2017, vol. 15, issue 3, 347-366

Abstract: Purpose - The purpose of this paper is to investigate the relationship between corporate governance effectiveness and information transparency. Hence, this paper seeks to extend prior information transparency research. Design/methodology/approach - This study uses a sample of 28 non-financial listed Tunisian companies and covers an eight-year period from 2006 to 2013. To test the hypotheses of this research, a simultaneous equation system model was applied. Findings - The results obtained show that, for the Tunisians companies, corporate governance practices have a significant positive effect on information transparency. The current study also provides evidence that pertinent information can improve corporate governance index. Research limitations/implications - The findings may be of interest to the academic researchers, practitioners and regulators who are interested in discovering the quality of corporate governance practices in Tunisian context. Practical implications - The findings of this study can help Tunisian regulators in creating corporate governance disclosure requirements. The findings also provide the African business community insights concerning the quality of corporate governance and of corporate reporting. Social implications - This research helps also to inform regulators about the benefits of disclosure more information to investors and to the firm. For instance, how the information can be a source of transparency and stability in the firms what and favors the social environment of the firms. Originality/value - This paper extends the existing literature by examining the causal relationship between corporate governance and information transparency.

Keywords: Corporate governance; Financial reporting; Disclosure; Corporate reporting (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfrapp:jfra-06-2016-0053

DOI: 10.1108/JFRA-06-2016-0053

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