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Corporate governance and risk reporting in South Africa: a study of corporate risk disclosures in the pre- and post-2007/2008 global financial crisis period

Corporate governance and risk reporting in South Africa: a study of corporate risk disclosures in the pre- and post-2007/2008 global financial crisis period
Corporate governance and risk reporting in South Africa: a study of corporate risk disclosures in the pre- and post-2007/2008 global financial crisis period
The 2007/2008 global financial crisis has reignited the debate regarding the need for effective corporate governance (CG) through sound risk management and reporting practices. This paper, therefore, examines the crucial policy question of whether the quality of firm-level CG has any effect on the quality and extent of corporate risk disclosures (CRD) in South Africa (SA) with particular focus on the pre- and post-2007/2008 global financial crisis period. Using one of the most extensive dataset to-date on CG and CRD from 2002 to 2011 and distinctively drawing on a multiple theoretical perspective, we find that CRD are largely ‘non-financial’, ‘historical’, ‘good news’ and ‘qualitative’ in nature over the ten-year period investigated. We also find that block ownership and institutional ownership are negatively associated with the extent of CRD, whilst board diversity, board size and independent non-executive directors are positively related to the extent of CRD. By contrast, dual board leadership structure has no significant connection with the extent of CRD. Our results are robust across a raft of econometric models that adequately address different types of endogeneity problems, as well as alternative CG and CRD proxies. Our findings are largely consistent with agency, legitimacy, institutional, resources dependence and stakeholder theoretical predictions.

Keywords: Corporate governance, Risk management and reporting, Multiple theoretical perspectives, 2007/2008 global financial crisis, King reports and South Africa

JEL classification: G20, G32, G34, G38
University of Southampton
Ntim, Collins G.
1f344edc-8005-4e96-8972-d56c4dade46b
Lindop, Sarah
01326442-043b-4924-90dc-fc43332d778a
Thomas, Dennis A.
094e07cf-9d77-4d26-96f1-89e88be840c7
Ntim, Collins G.
1f344edc-8005-4e96-8972-d56c4dade46b
Lindop, Sarah
01326442-043b-4924-90dc-fc43332d778a
Thomas, Dennis A.
094e07cf-9d77-4d26-96f1-89e88be840c7

Ntim, Collins G., Lindop, Sarah and Thomas, Dennis A. (2012) Corporate governance and risk reporting in South Africa: a study of corporate risk disclosures in the pre- and post-2007/2008 global financial crisis period Southampton, GB. University of Southampton

Record type: Monograph (Working Paper)

Abstract

The 2007/2008 global financial crisis has reignited the debate regarding the need for effective corporate governance (CG) through sound risk management and reporting practices. This paper, therefore, examines the crucial policy question of whether the quality of firm-level CG has any effect on the quality and extent of corporate risk disclosures (CRD) in South Africa (SA) with particular focus on the pre- and post-2007/2008 global financial crisis period. Using one of the most extensive dataset to-date on CG and CRD from 2002 to 2011 and distinctively drawing on a multiple theoretical perspective, we find that CRD are largely ‘non-financial’, ‘historical’, ‘good news’ and ‘qualitative’ in nature over the ten-year period investigated. We also find that block ownership and institutional ownership are negatively associated with the extent of CRD, whilst board diversity, board size and independent non-executive directors are positively related to the extent of CRD. By contrast, dual board leadership structure has no significant connection with the extent of CRD. Our results are robust across a raft of econometric models that adequately address different types of endogeneity problems, as well as alternative CG and CRD proxies. Our findings are largely consistent with agency, legitimacy, institutional, resources dependence and stakeholder theoretical predictions.

Keywords: Corporate governance, Risk management and reporting, Multiple theoretical perspectives, 2007/2008 global financial crisis, King reports and South Africa

JEL classification: G20, G32, G34, G38

Full text not available from this repository.

More information

Published date: 1 June 2012
Organisations: Centre of Excellence in Decision, Analytics & Risk Research, Accounting

Identifiers

Local EPrints ID: 343631
URI: https://eprints.soton.ac.uk/id/eprint/343631
PURE UUID: a3e4659a-9e96-4c7f-9dfb-8480407c5753
ORCID for Collins G. Ntim: ORCID iD orcid.org/0000-0002-1042-4056

Catalogue record

Date deposited: 09 Oct 2012 13:51
Last modified: 14 Dec 2018 01:42

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Contributors

Author: Collins G. Ntim ORCID iD
Author: Sarah Lindop
Author: Dennis A. Thomas

University divisions

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