The readability-corporate governance nexus: evidence from the Indian listed companies

Nitin Dhir and Balwinder Singh

Global Business and Economics Review, 2025, vol. 33, issue 2, 225-250

Abstract: We investigate the impact of corporate governance effectiveness on the readability of annual reports in the Indian context. While prior research predominantly focused on structural and quantitative aspects of corporate reporting, the present study pioneers the examination of qualitative aspects of reporting like readability. The dataset consists of 405 companies for five years from 2015 to 2019. Data analysis revealed a positive association between effective governance practices and readability scores in annual reports. This analysis indicates that companies adhering to sound governance standards tend to produce reports that are readily understandable to stakeholders. The empirical evidence fortifies the academic foundation in the emerging field of corporate governance, reporting quality, and narrative disclosures. Our study underscores the importance of effective corporate governance practices for executives, policymakers, investors, and analysts, aiming to enhance transparency and trust in the Indian corporate sector.

Keywords: readability; FOG; SMOG; obfuscation; corporate governance; governance framework; legitimacy theory; agency theory. (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ids:gbusec:v:33:y:2025:i:2:p:225-250

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