Board monitoring and corporate disclosure: the role of the institutional environment and firm-level governance

IF 3.2 Q1 BUSINESS, FINANCE
Alexander Muravyev
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引用次数: 0

Abstract

Purpose

This article aims to answer two research questions that remain controversial in the accounting and corporate governance literature: (1) how corporate disclosure is related to board monitoring and (2) how this link is affected by the institutional environment and firm-level governance.

Design/methodology/approach

The study is based on S&P data on corporate disclosure by Russian companies collected over 2002–2010 and supplemented by information from the SKRIN database. The dataset covers 125 non-financial companies, with 559 observations in total. We use three indicators of board monitoring: the percentage of non-executive directors, a dummy for two-tier boards, and a dummy for an audit committee. The firm’s governance is proxied by a dummy for single class stock, while the institutional environment is proxied by a dummy for ADRs/GDRs. We apply conventional methods of panel data analysis with several robustness checks, including the random- and fixed-effects models, 2SLS that addresses the potential endogeneity of board composition, alternative definitions of the dependent variable, and an extended list of controls.

Findings

We find a positive (complementary) relationship between the amount of disclosure and the proxies for board monitoring employed. This complementary relationship turns out to be the strongest among companies that have better internal governance but face a weaker institutional environment. There is little evidence of such complementarity under strong institutions.

Practical implications

The findings may be of interest to investors and policymakers. As to the former, the results warn of firms that provide limited disclosure in the presence of strong corporate governance arrangements, such as independent boards, as these factors are not substitutes for each other. As to the latter, the results support comprehensive policies aimed at simultaneous improvements in both board governance and corporate disclosure in weak institutional settings.

Originality/value

This paper uses a unique setting and rich, partly proprietary data to extend the existing literature on the relationship between corporate disclosure and board monitoring, with an emphasis on the moderating role of the institutional environment and firm-level governance. It is also one of the very few studies of corporate disclosure in Russia, an important emerging economy of the early 2000s.

董事会监督和公司信息披露:制度环境和公司治理的作用
本文旨在回答会计和公司治理文献中仍存在争议的两个研究问题:(1) 公司信息披露与董事会监督之间的关系;(2) 制度环境和公司层面的治理对这种联系有何影响。数据集涵盖 125 家非金融公司,共有 559 个观测值。我们使用了三个董事会监督指标:非执行董事比例、两级董事会虚拟指标和审计委员会虚拟指标。公司治理情况用单一类别股票虚拟指标表示,制度环境用美国存托凭证/全球存托凭证虚拟指标表示。我们采用了常规的面板数据分析方法,并进行了若干稳健性检验,包括随机效应和固定效应模型、解决董事会构成潜在内生性的 2SLS、因变量的替代定义以及扩展的控制列表。这种互补关系在内部治理较好但面临的制度环境较弱的公司中最为明显。实际意义这些发现可能会引起投资者和政策制定者的兴趣。就前者而言,研究结果警示那些在独立董事会等强有力的公司治理安排下提供有限信息披露的公司,因为这些因素并不能相互替代。至于后者,研究结果支持在薄弱的制度环境中同时改善董事会治理和公司信息披露的综合政策。 原创性/价值 本文利用独特的环境和丰富的部分专有数据,扩展了关于公司信息披露与董事会监督之间关系的现有文献,并强调了制度环境和公司层面治理的调节作用。这也是为数不多的关于俄罗斯公司信息披露的研究之一,俄罗斯是本世纪初重要的新兴经济体。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
CiteScore
5.80
自引率
13.00%
发文量
38
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