Corporate governance attributes, firm characteristics and the level of corporate disclosure: Evidence from the Indian listed firms

Sunil Nandi,Santanu Kumar Ghosh

doi:10.5267/j.dsl.2012.10.004

Sunil Nandi, Santanu Kumar Ghosh

Open Access

https://doi.org/10.5267/j.dsl.2012.10.004

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Abstract

Article history: Received July 25, 2012 Accepted October 10, 2012 Available online October 18 2012 This study investigates the association between firm characteristics, corporate governance attributes and the level of corporate disclosure of listed firms in India. The research paper has been based on a sample of 60 firms listed in the Bombay Stock Exchange (BSE) / National Stock Exchange (NSE) during the study period from 2000-01 to 2009-10. The study has used the Standard & Poor (2008) model for measuring the level of corporate disclosure. To examine the association between explanatory variables and the level of corporate disclosure, multiple regression model has been used. The results suggest a positive relationship between board size, ratio of audit committee members to total board members, family control, CEO duality, firm size, profitability, liquidity and the extent of corporate disclosure. However, the degree of corporate disclosure is negatively related to board composition, leverage and age of the firm. © 2013 Growing Science Ltd. All rights reserved.

Highlights

In recent years, several scandals and scams concerning the activities of the business enterprises have occurred around the globe
This study investigates the association between firm characteristics, corporate governance attributes and the level of corporate disclosure of listed firms in India
Objective of the Study The primary objective of this study is to examine the association between firm characteristics, corporate governance attributes and the extent of corporate disclosure of the 60 listed firms operating in India

Summary

Introduction

Several scandals and scams concerning the activities of the business enterprises have occurred around the globe. Due to these corporate failures, the importance of corporate disclosure has been increasing day by day. Annual report is the most important medium of the reported transparency and corporate disclosure practices. Less information disclosure in the annual reports creates information asymmetry. Higher level of corporate disclosure in the financial reports reduces the information asymmetry between companies and the investors, enhances the value of stock in the capital market and increases liquidity (Karim, 1996). The levels of corporate disclosure vary from firm to firm, industry to industry and from country to country. Earlier research studies examine various firm characteristics and their relationship with the degree of voluntary corporate disclosure (Firth, 1979; Cooke, 1989; Owusu-Ansah, 1998; Ho & Wong, 2001; Chau & Gray, 2002; Aktaruddin, 2005; Narasimhan & Vijayalakshmi, 2006; Hossain & Hammami, 2009)

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