Does Corporate Governance Influence Voluntary Disclosure? Evidence from India

Rupjyoti Saha(1), Kailash Chandra Kabra(2),


(1) North-Eastern Hill University, Department of Commerce, Shillong (Meghalaya)
(2) North-Eastern Hill University, Department of Commerce, Shillong (Meghalaya)

Abstract

The purpose of this study is to examine the influence of different corporate governance (CG) attributes on voluntary disclosure (VD) made by 100 sample companies listed on Bombay Stock Exchange (BSE) in their annual reports. To this end, the paper uses appropriate panel data regression technique whereby the results indicate that three CG attributes such as board independence, board’s gender diversity and risk management committee have significant influence on VD. In particular, board independence is found to have weak negative influence on VD while board’s gender diversity and risk management committee indicates strong positive influence on VD. The other CG attributes such as board size, role duality, ownership concentration, audit committee independence and nomination and remuneration committee does not reveal any significant influence on VD. Overall, the finding suggests that one of the conventional attribute of CG i.e., board independence and VD act as alternate control mechanism in reducing agency cost and protecting investors’ interest while VD co-exists with some latest CG attributes like board’s gender diversity and risk management committee in monitoring managers. The result of this paper should be of relevance to regulators, practitioners and other market participants in Indian context and other emerging market having similar institutional setting.

Keywords

corporate governance attributes; India; voluntary disclosure index

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DOI: https://doi.org/10.28992/ijsam.v3i2.97

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