Level Of Disclosure Research Articles

Who gains favor with green investors amidst climate risk?

PurposeThis study aims to investigate the impact of climate risk disclosure by listed companies on the entry of green investors. It seeks to understand how proactive climate risk disclosure can attract green investment and the underlying mechanisms that facilitate this process.Design/methodology/approachTextual analysis is employed to assess the extent of climate risk disclosure in annual reports. The research constructs indicators for green investor entry and applies regression analysis to examine the relationship between climate risk disclosure and green investment, considering various mediating variables such as positive online news coverage, ESG scores, and corporate reputation.FindingsGreen investors are more likely to invest in companies with higher levels of climate risk disclosure. This relationship is robust across different types of firms, with non-state-owned, non-high-tech, large-scale firms, and those in the Eastern region showing a stronger attraction to green investors. Climate risk disclosure promotes green investment through the “signal transmission” mechanism, enhancing corporate reputation and ESG performance.Originality/valueThis paper extends the traditional theory of external incentives for corporate green development to include autonomous incentives through active climate risk disclosure. It provides new insights into the theory of corporate sustainable development and offers practical recommendations for enhancing corporate green development pathways. The study’s comprehensive approach and use of extensive data contribute valuable knowledge to the field of green investment and corporate sustainability.

The Impact of Board of Directors on the Disclosure of Sustainable Development of Listed Firms

Vietnam is a developing country with many remarkable achievements. However, in recent years, economic and social development in Vietnam still relies heavily on the exploitation of natural resources; labor productivity is still low; production technology and consumption models still use a lot of energy and raw materials and emit a lot of waste. Vietnam's development process is facing many severe challenges, with potential risks of unsustainable development such as climate change, environmental pollution, depletion of natural resources, etc. Therefore, Vietnamese firms need to be aware that economic development is always associated with environmental protection activities and social responsibility. This study is conducted to investigate the impact level of the disclosure of sustainable development of Vietnamese listed firms. The study determines the impact of board of directors on the level of sustainable development information disclosure of these firms. Data was collected from annual reports, corporate sustainability reports, management reports, and financial reports of 345 firms in 2023. The results reveal that the level of disclosure of sustainable development of Vietnamese listed firms is low, no firm discloses 100% fully, some firms do not publish sustainable development information. The findings also show that the level of mandatory disclosure of sustainable development is higher than the level of voluntary disclosure of sustainable development. The research results show that The board of directors factors do not impact the level of mandatory disclosure of sustainable development. There are four determinants related to the board of directors that impact the level of voluntary disclosure of sustainable development, including board size, board independence, the proportion of foreign BOD members, the chairman-cum-CEO have a positive impact (in the same direction) on the level of disclosure of sustainable development. Based on the findings, several recommendations are proposed for promoting the disclosure of sustainable development information on the side of Vietnamese listed firms.

Chief Sustainability Officer (CSO) power and sustainability-based compensation for climate change disclosure and carbon performance: is it different for developed and developing nations?

Purpose Companies are increasingly appointing a Chief Sustainability Officer (CSO) to anchor the need to highlight climate change at the senior management level. This study aims to examine how CSO power and sustainability-based compensation influence climate reporting and carbon performance. Design/methodology/approach Using one of the largest data sets to date, consisting of 18,834 company years through the author’s observations, spanning an 11-year period (2011–2021) in 33 countries. This paper used quantitative methods – specifically, ordinal logistic regression estimation. This paper measures the level of climate change disclosure based on the carbon disclosure leadership methodology. Carbon performance is based on the intensity of carbon emissions (Scope 1, Scope 2), which is a quantitative and relatively more objective measure. Findings The results suggest that climate change disclosure continued to increase and the carbon emissions intensity of the companies in this study gradually decreased over the sample period. This paper finds that the presence of the CSO within the top management team has a positive and significant influence on the level of information on climate change of the companies in the sample. This finding confirms the idea that the managerial capacity of CSOs motivates the disclosure of climate change. The empirical results confirm that there are differences in the role that the CSO and sustainability-based compensation play in influencing the quality of climate information disclosure in developed and developing countries. Originality/value The recourse on a mixed theoretical framework, which highlights upper echelons theory, argues the understanding of the role of CSOs in explaining the relationship between climate change disclosure–carbon performance relationship. The novelty of the study lies in the approaches adopted to describe the quality of climate change disclosure. To control for endogeneity, this paper uses a difference-in-difference analysis by adding a firm to the Morgan Stanley Capital International index as an exogenous shock.

Exploring the level of realm disclosure for Indonesian insurance business using ISO 31000

Exploring the level of realm disclosure for Indonesian insurance business using ISO 31000

Does the Confucianism in audit firms enhance the corporate ESG Disclosure?

This paper examines the role of Confucian culture characterized by traditional virtues such as benevolence, righteousness, propriety, wisdom, and trust in audit firms and corporate ESG disclosure. Using data from Chinese A-share listed companies from 2008 to 2021, we found that Confucian culture in audit firms significantly promotes the level of corporate ESG disclosure. We also tested the moderating effect of regional culture and corporate culture, and found that in regions with stronger merchant guild culture and higher levels of social trust, as well as in companies with a stronger culture of integrity and cooperation, the promotion effect of Confucian culture in audit firms on corporate ESG disclosure is more pronounced. Furthermore, we discovered that the closer the geographical distance between audit firms and client companies, the greater the positive impact of Confucian culture in audit firms on corporate ESG disclosure. Overall, this study reveals the modern value of Confucian traditional culture for the improvement of enterprises’ environmental friendly behaviors from the perspective of external audit, and highlighted the relevance of informal institutions in corporate governance.

DISCLOSURE OF SUSTAINABILITY REPORTS

The bank does not focus on profits but pays attention to the environment and social issues that lead to sustainable development. The Financial Services Authority (OJK) issued regulations regarding Technical Guidelines for Preparing Sustainability Reports. This research aims to determine the level of disclosure of sustainability reports in 2022 at state-owned banks and state-owned companies on the Indonesian Stock Exchange. The research method uses descriptive analysis, which describes the research object based on facts and then analyzes and interprets it. The research results on the level of disclosure of sustainability reports are very good, and show management's commitment to fulfilling disclosure obligations regarding environmental sustainability in economic, environmental, and social aspects. Companies need to improve and optimize programs such as environmentally friendly products, involvement of local parties with sustainable financial business processes, conservation, and biodiversity conversion efforts.

Corporate governance impact on risk disclosure in Shariah-compliant financial firms of Kuwait

Purpose This study aims to investigate the relationship between corporate governance characteristics and risk disclosure in Shariah-compliant financial firms operating in Kuwait. It aims to provide insights into the factors influencing risk disclosure practices within these institutions. Design/methodology/approach The research used manual content analysis to quantify risk disclosure levels in the annual reports of 47 Shariah-compliant financial companies listed in Kuwait in 2020. Subsequently, multiple regression analysis was conducted to assess the impact of various corporate governance factors on the extent of risk disclosure. Findings The study reveals that while Kuwaiti Shariah-compliant firms exhibit limited risk disclosure in their annual reports, larger boards and committees, along with a higher number of independent directors, positively influence the level of risk disclosure. Interestingly, the size of the Shariah supervisory boards did not show a significant impact on risk disclosure practices. Practical implications These findings hold regulatory implications for Kuwait, highlighting the need to ensure information adequacy and promote market efficiency. Additionally, they offer practical insights for managers and investors seeking to optimize fund sourcing and diversify investment portfolios within the context of Shariah-compliant financial institutions. Originality/value This study contributes to the existing literature by providing empirical evidence on the relationship between corporate governance characteristics and risk disclosure in the specific context of Shariah-compliant financial firms operating in Kuwait. Furthermore, it identifies avenues for future research to delve into the influence of additional governance factors on risk disclosure practices within this unique financial landscape.

Is CEO power linked to corporate social responsibility disclosure? Evidence from an emerging economy

AbstractThe research aims to analyze the influence of Chief Executive Officer (CEO) power factors on corporate social responsibility (CSR) disclosure by listed companies on the Vietnamese stock market. To examine the relationship between CEO power and CSR disclosure (CSRD), our study used the generalized method of moments (GMM) estimation method with panel data from 210 listed companies on the Vietnamese stock market during the period 2015–2022. The research results indicate that factors such as duality, tenure, share ownership, and CEO compensation reduce the level of CSR disclosure by companies. On the other hand, CEO education and age show a positive relationship with disclosure level. The empirical results of this study provide a solid foundation for managers to establish effective corporate governance mechanisms and enhance the quality of sustainable reporting by companies.

Developing Enterprise Risk Management Disclosure Index using Factor Analysis

This study aims to explore the Enterprise Risk Management (ERM) disclosure by publicly listed firms in Malaysia. This study analyses a sample of 832 non-financial publicly listed firms in Malaysia between 2016-2019. This study used a more comprehensive index by embedding COSO-integrated ERM framework 2017 and ISO 31000. The data is analyzed using factor analysis to develop the ERM disclosure index. The results show that ERM disclosure consists of 4 main components: governance and culture, performance, objective setting, and reporting approach. Meanwhile, the level of ERM disclosure is still at a moderate level.

Increasing Firm Value, Financial Performance Through Sustainable Development Goals Report and GCG in Go Public Companies

This study examines the relationship between the Sustainable Development Goals (SDGs) report, corporate governance, financial performance, and the value of mining companies that go public. The data analysis technique uses Partial Least Square (PLS). The research data is in the form of annual resport, and financial statements of mining companies listed on the IDX from 2019 to 2022. The scope of the study includes various determining factors such as the quality and level of disclosure of the SDG report, the effectiveness of corporate governance mechanisms, and the combined influence of them on financial performance and company value. The findings show that two determining factors significantly affect the value of a company. SDG reports have a significant positive influence on financial performance but a non-significant positive effect on company value. Good Corporate Governance has a significant positive impact on financial performance but has a significant negative effect on the SDG report and company value. Financial performance, in turn, positively and significantly affects the value of a company.

The impact of environmental court construction on the quality of corporate environmental information disclosure

This study evaluates the relationship between establishing environmental courts and corporate environmental information disclosure quality. We use panel data from 28,718 Chinese listed companies between 2008 and 2022 and investigate whether the quality of environmental information disclosure by companies improves owing to the establishment of regional environmental courts. The results indicate that the quality of environmental information disclosure increase significantly after establishing environmental courts in the region. Factors such as corporate green culture, public environmental awareness, and local environmental regulatory strength play intermediary roles in this relationship. In the heterogeneous analysis, we find that the effect of environmental court construction on improving the quality of environmental information disclosure is more significant for highly polluting industries and state-owned enterprises. Additionally, environmental courts are more effective in enhancing the quality of corporate environmental information disclosure in regions with the low level of legalization and the high level of environmental information disclosure. Our research contributes to environmental court construction and corporate environmental information disclosure literature and provides decision-making references for businesses and governments.

Corporate narrative reporting on Industry 4.0 technologies: do the COVID-19 pandemic and governance structure matter?

PurposeThis research examines the impact of the COVID-19 pandemic and governance structure on corporate narrative reporting (CNR) concerning Industry 4.0 (I4.0) technologies in Jordanian commercial banks. The study aims to explore how these factors influence the extent and nature of disclosures in annual reports.Design/methodology/approachThe study uses a comprehensive manual content analysis method to investigate the annual reports from all 15 Jordanian commercial banks from 2010 to 2022. This approach allows for the detailed examination of I4.0 disclosures, using a specially developed index to measure various disclosure dimensions. An ordinary least squares model is used to assess the determinants of CNR on I4.0, considering factors such as the pandemic’s impact and various governance attributes.FindingsThe findings indicate that both the COVID-19 pandemic and specific governance factors (e.g. board size and audit committee size) significantly enhance the disclosure of I4.0 technologies. The study reveals that during the pandemic, banks significantly increased their level of detailed disclosures about I4.0 strategies, challenges and benefits, reflecting a strategic response to the pandemic’s disruption.Originality/valueThis study introduces a novel I4.0 Reporting Index for banks, measuring disclosures across strategy implementation, business model transformation, challenges and benefits. It adds to the existing literature by offering insights into narrative reporting practices concerning I4.0 technologies within the banking sector and illuminates the impact of the COVID-19 pandemic on these practices.

Assessing the influence of ESG washing on bank reputational exposure: A cross‐country analysis

AbstractThe study investigates the effects of ESG washing on banks' reputational exposure. We define ESG washing as a disparity between a bank's environmental and social disclosure level and the practical implementation of the relative measures. The analysis involves an international sample of 120 banks operating across 35 countries from 2014 to 2020. The results evidence a different effect based on the pillar considered: the higher the inconsistency on environmental issues, the higher a bank's reputational exposure. Conversely, higher levels of disclosure compared to performance on social issues appear to reduce reputational exposure. In addition, citizen movements and the country's legal system play a significant role in amplifying or mitigating a bank's reputational exposure. Our findings offer insight into the phenomenon of ESG washing in the banking industry, supporting the need for more verified information across countries and all economic sectors.

Factors influencing online sustainability disclosure in Spanish universities

Purpose This paper aims to investigate the extent of sustainability disclosure through websites at Spanish universities and analyse the determinants that affect such disclosure. Design/methodology/approach This study uses as methodology a content analysis of the sustainability information disclosed by universities on their official websites in 2022 and a regression of ordinary least squares. Findings Findings emphasise that Spanish universities have moderate levels of online sustainability disclosure, close to 50%, showing prevalent attention to dimensions concerning “organisation profile and governance”, “economic aspects” and “labour practices”, while “curriculum and teaching on sustainability topics” and “environmental” dimensions were less addressed. On the other hand, the findings indicate that public and larger universities are the ones most engaged in the online disclosure of information about sustainability issues. Likewise, universities led by female rectors exert a positive influence on sustainability disclosure on websites. Practical implications The results could be useful for policymakers and regulators to implement and standardise sustainability reporting at higher education institutions, as well as for managers at universities who wish to increase the diffusion of sustainability outreach to satisfy stakeholders’ demands and legitimise their actions in society. Originality/value To the best of the authors’ knowledge, this paper is the first Spanish approach to identify the explanatory factors for sustainability reporting in Spanish higher education institutions.

Narrative disclosure and earnings quality: what is the nexus? Evidence from emerging countries

PurposeNarrative disclosures offer further elucidation of a company's financial performance beyond what is presented in numerical format. This can assist stakeholders in gaining a deeper comprehension of the elements that impact reported earnings, thereby improving the quality of financial information. The current research explores the impact of narrative disclosure on the earnings quality of firms listed on the Amman Stock Exchange (ASE).Design/methodology/approachAppropriating an index to measure the narrative disclosure level in the research sample firms, the research utilizes an analysis of the textual content of nonfinancial reports and statements issued by the management of the ASE-listed nonfinancial firms between 2013 and 2022. The financial statements issued in the annual financial reports are also adopted to extract data on earnings quality and the controlling variables. The analysis of the data and attainment of the findings necessitate using the panel data.FindingsIt is indicated that narrative disclosure affects earnings quality. To be precise, the greater the narrative disclosure, the lower the absolute value of the voluntary discretionary accruals and thus the higher the quality of accounting earnings.Research limitations/implicationsThe findings contribute to new research on disclosure issues, particularly narrative disclosure, which enhances reader confidence in financial and nonfinancial reports and prevents misleading and manipulated information.Originality/valueThis research helps decision-makers understand the relationship between reports, statements and earnings quality in a firm. It's unique in exploring this relationship, especially in developing countries. The study is the first of its kind in Jordan, known for its economic stability and strategic location in the Middle East, making its findings applicable to similar environments.

"I want to be healthy and move on": A qualitative study of barriers and facilitators to antiretroviral treatment adherence among young adult survivors with perinatal HIV in Thailand.

We know that HIV treatment outcome depends on antiretroviral treatment (ART) adherence. Young adults with perinatal HIV (YPHIV) who survived have endured various adherence challenges in their adolescent years. While some of them could maintain perfect adherence with sustainable virologic suppression, many experienced one or more episodes of virologic failure. We explored factors affecting ART adherence from real-life experiences of YPHIV. A qualitative study was conducted between June and November 2022. Twenty YPHIV aged 21-29 years with a history of virologic failure and resumed virologic suppression during adolescent years were invited to share their experiences through individual in-depth interviews. Audio records were transcribed verbatim and analyzed using deductive thematic analysis. We divided excerpts into two themes: barriers and facilitators to ART adherence. The socio-ecological model was used to frame subthemes at personal, societal, and healthcare system levels. Most barriers to adherence were concentrated at the personal level, including work/study-related conditions, personal entertainment, medication issues, mental health problems, thought, and belief. At the societal level, social activities and fear of HIV disclosure were frequently mentioned as barriers. Medical care cost was the only identified barrier at the healthcare system level. The facilitators to adherence at the personal level included perceiving health deterioration, being afraid of hospitalization and medical procedures, and wishing to be healthy and move on. At the same time, perceived family support and determination to complete family without HIV transmission were identified as facilitators at the societal level. Service behaviors of healthcare providers were mentioned as facilitators to adherence at the healthcare system level. From this study, most factors associated with non-adherence in adolescents were at the personal level, and the fear of HIV disclosure was critical at the societal level. The key facilitator to adherence was the determination to be healthy and have a promising future. Our findings reinforce the importance of establishing youth-friendly services in the existing HIV care setting. More time allocation for tailored individual counseling, using other novel approaches like mHealth, online media, and involvement of social support from different sectors might be beneficial to maximize adherence self-efficacy during the transitional period of YPHIV.

Gender diversity and climate disclosure: a tcfd perspective

AbstractThe paradigm of corporate environmental disclosures aimed at investors developed in 2017 with the Task Force on Climate-related Financial Disclosures (TCFD) recommendations. Existing literature on social responsibility disclosures points to gender diversity on the board of directors as an influencing factor. This study aims to assess the influence of gender diversity in climate-related financial disclosures, as recommended by the TCFD based on a sample of 27 companies operating within the sectors of electricity, oil, coal and gas, water, and alternative energy that have announced their adherence to the recommendations from 2017 to 2021. By applying a linear regression model, the results indicate the presence of a positive association between the level of TCFD disclosures and board gender diversity, as well as other factors, such as company size, CEO duality, and general liquidity. However, the influence of board gender diversity on corporate reporting based on the TCFD recommendations suggests that the commitment of boards to the reporting of climate change risks and opportunities is not significantly dependent on gender diversity, as the presence of women in the Boards is favorable for the reporting but without a significant impact on the level of disclosures. This research offers insights into sustainability reporting practices, focusing on a relatively new perspective of reporting climate-related financial topics and their determinants. The findings hold implications for organizational leaders and stakeholders, mainly investors, as these recent sustainable reporting practices are challenging but also bring new opportunities related to transparency towards climate-related issues.

ZAKAT DISCLOSURE INDEX BY ISLAMIC BANKS AND DEVELOPMENT FINANCIAL INSTITUTIONS IN MALAYSIA

Paying zakat and disclosing it transparently to stakeholders is one of the ways to demonstrate the Islamic ethical value and accountability of Islamic finance institutions (IFIs). Nevertheless, comprehensive zakat information disclosure practices by Islamic banks (IBs) and Development Financial Institutions (DFIs) have received less attention. Therefore, this study was conducted to develop a comprehensive Zakat Disclosure Index (ZDI) for IBs and DFIs and measure the ZDI level of these institutions. Content analysis was performed through financial statements, annual reports, annual integrated reports and annual sustainability reports for four consecutive financial years from 2016 to 2019. The entire population of 16 IBs and 6 DFIs was selected. The ZDI was developed with two categories based on the liability of paying zakat. The scoring was divided into three groups: (i) mandatory financial information versus voluntary financial information versus mandatory non-financial information versus voluntary non-financial information; (ii) mandatory versus voluntary; and (iii) financial versus non-financial. The result showed that the overall disclosure level was at 60 percent, where mandatory disclosure was at 43 percent and voluntary disclosure was at 17 percent, while for financial and non-financial information, the scores were not much different at 25 percent to 33 percent. The study’s implication lies in establishing astandardised zakat index, enhancing comparability among reporting entities. Furthermore, the study holds importance for regulators as it aids in assessing the sufficiency of existing regulations and guidelines. It can guide regulatory actions to uphold the principles of maqasid shariah in reporting practices.

The Impact of Financial Stability and Audit Firm Affiliation on the Level of Disclosure of Sustainable Green Banking

The Impact of Financial Stability and Audit Firm Affiliation on the Level of Disclosure of Sustainable Green Banking

Disclosure hesitancy and disaster risk: A survey of tailings professionals in the global mining industry

The global mining industry faces multiple, overlapping calls for greater levels of public disclosure about tailings facilities. Tailings professionals are pivotal to the industry’s public disclosure practice because they generate much of the information stakeholders are seeking. We surveyed 183 tailings professionals across the world to explore patterns of local-level information disclosure in mining. Most respondents had limited experience disclosing information publicly or engaging locally. Our findings raise questions about how the industry is engaging with local communities about disaster risk. Unless waste management practices evolve radically in coming decades, the predicted increase in global mining activity will coincide with an exponential increase in mine waste. Given the high-stakes nature of tailings facility failures, questions about public disclosure and disaster risk remain pressing.