Boardroom characteristics and forward-looking information disclosure: evidence from Ghana

Abstract

PurposeAmid growing stakeholder needs, this study aims to assess the effect of boardroom characteristics on the disclosure of forward-looking information by listed firms on the Ghana stock exchange (GSE). Further, it investigates the mediating role of firm size in the relationship between boardroom characteristics and forward-looking information disclosure (FLID).Design/methodology/approachUsing data from the annual reports of a sample of firms on the GSE in 2019 and multiple regression analysis, the effect of boardroom characteristics on the disclosure of forward-looking information is ascertained.FindingsThe results depict that board gender diversity, i.e. female representation on the board, is positive and significantly related to firms’ disclosure levels on the GSE. Similarly, board independence and auditor type have a positive and significant relationship with FLID, whereas profitability and financial leverage do not affect disclosure levels. The further analysis depicts that the relationship between board size and FLID is mediated by firm size.Practical implicationsThis study’s findings would aid management, market regulators and investors in Ghana and other developing contexts assess mechanisms that would increase FLID among firms to satisfy stakeholders.Originality/valueThis paper focuses on the extent of FLID after the setbacks and subsequent rejuvenation of Ghana’s financial and nonfinancial system. Specifically, this paper adds to the few studies on the African continent that examined the influence of boardroom characteristics on FLID.