Corporate Governance Structures and Corporate Internet Reporting in Africa: The Case of Kenya and Tanzania

Abstract

The purpose of this study is to investigate corporate internet reporting (CIR) by Kenyan and Tanzanian listed companies and to examine whether the level of CIR is related to corporate governance structures. CIR is measured using a disclosure index. We collect data for a four-year period from companies listed on the Nairobi Stock Exchange and the Dar es Salam Stock Exchange. The data are analysed using panel data models. The results indicate that the level of CIR is high, with significant growth in CIR levels over the 4-year period in both countries. We show that CIR increases with audit committee independence and financial expertise. The effects of ownership concentration are country specific, with CIR increasing (decreasing) with ownership concentration in Tanzania and Kenya, respectively. The results demonstrate that effective governance structures matter for CIR on the African continent. Therefore, the current policy initiatives on improving governance and reporting practices in Africa are appropriately directed and need to be intensified to improve corporate governance and reporting quality in order to attract foreign investments. The study contributes to the limited research on governance structures and reporting practices in general, and CIR in particular, in Africa.