The effect of governance mechanisms on the quality of risk disclosure: using bootstrap techniques

Mousa, Gehan A.; Elamir, Elsayed A. H.

doi:10.1504/ajfa.2014.060811

Cited by 14 publications

(24 citation statements)

References 45 publications

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“…While board size affects negatively ( p < .01) RRD by conventional banks, the presence of independent and foreign members on the board of Islamic banks increases their level of RRD ( p < .01). These findings corroborate our 9th, 10th and 11th hypotheses and are consistent with Abraham and Cox (2007), Lopes and Rodrigues (2007), Oliveira et al (2011b), Barakat and Hussainey (2013), Elshandidy et al (2013) and Mousa and Elamir (2014). They indicate besides that small boards in conventional banks are more efficient in fulfilling their monitoring role with regard banks' transparency about their risk factors.…”

Section: Resultssupporting

confidence: 91%

“…Recent studies examined the impact of board size on RRD and provided conflicting results. While Hussainey and Elzahar (2012) find no relationship between board size and risk reporting, Mousa & Elamir (2014) end to a negative association between both variables and others find a positive association (Al‐Najjar & Hussainey, 2011; Laksmana, 2008; Mellett & Mokhtar, 2013; Ntim et al, 2013).…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

“…Empirical finding on the association between corporate disclosure and foreign ownership are mixed. While Haniffa and Cooke (2002) and Barako, Hancock, and Izan (2006) showed that higher level of foreign ownership increases corporate disclosure, Mohobbot (2005), Konishi and Ali (2007) and Mousa and Elamir (2014) found insignificant association between risk‐related information and foreign ownership. Hence, we state the following hypothesis:Hypothesis There is a significant positive association between foreign investors and the extent of bank risk disclosure.…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

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What drives risk disclosure in Islamic and conventional banks? An international comparison

2020

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This paper examines and compares the relationship between risk disclosure and corporate attributes in Islamic and conventional banks. Using a comprehensive risk disclosure index covering nine dimensions, we analyse the level of risk‐related disclosure (RRD) in a sample of 72 Islamic banks and 97 conventional banks across 11 countries. The RRD index shows that Islamic banks disclose less information about risk comparing to conventional banks. Listed banks, larger banks and aged bank disclose more information about risk than the others. Block holders, foreign ownership and board size affect negatively risk disclosure. However, board independence and the percentage of foreign directors in the board affect positively risk disclosure. Moreover, banks with higher Tier 1 ratio disclose less information about risk. Our results encourages regulators to improve corporate governance mechanisms in their banking systems through the optimization of ownership structure (dispersed ownership) and the board's composition in order to promote higher level of transparency and RRD.

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Section: Resultssupporting

confidence: 91%

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

See 1 more Smart Citation

What drives risk disclosure in Islamic and conventional banks? An international comparison

2020

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“…Empirical finding on the association between corporate disclosure and foreign ownership are mixed. While Haniffa & Cooke (2002) and Barako et al (2006) showed that higher level of foreign ownership increases corporate disclosure, Mohobbot (2005) and Mousa & Elamir (2014) found insignificant association between risk related information and foreign ownership. Hence, we state the following hypothesis:…”

Section:  Foreign Ownership and Risk Disclosurementioning

confidence: 98%

Do ownership structures affect risk disclosure in Islamic banks? International evidence

Moumen

Grassa

Hussainey

2020

JFRA

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Purpose Previous works assessing the determinants of banks’ risk disclosure in emerging economies focused on one aspect of risk reporting such as market risk disclosure or operational risk disclosure. While banks’ transparency about other major risk types (e.g. capital adequacy, liquidity risk…) is important for both market discipline and for their financial stability, no previous research has tried to discuss their determinants for Islamic banks. This paper aims to fill the gap by assessing the effects of deposits structure and ownership concentration on risk disclosure for Islamic banks. Design/methodology/approach The authors based on a sample of 71 Islamic banks operating in 12 emerging economies and observed over the period 2009–2014. The authors used a risk disclosure index covering nine dimensions, and the authors used both generalized least squares (GLS) regression and generalized method of moments (GMMs) as econometric tools. Findings The findings suggests that the level of risk disclosure is lower for Islamic banks with higher ownership concentration, leveraged bank, listed banks and Islamic banks. However, risk disclosure is higher for Islamic banks with higher concentration of profit sharing investment account (PSIA) and higher foreign ownership, large Islamic banks, aged banks, Islamic banks operating in country with higher country transparency index, positively correlated to gross domestic products and Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) adoption. By disaggregating total risk disclosure into the nine sub-categories, the authors are able to specify, also, the components of risk disclosure impacted by various determinants. Research limitations/implications This paper’s findings are subject, also, to a number of limitations. First, there was manual scoring of annual reports (subjectivity). Second, while some items might have higher information content or be more useful than others for users of Islamic banks’ annual reports, no weighting is assigned to items. Third, the research focuses exclusively on the 12 countries and excludes the other Middle East, Southeast Asia and Far East countries where ownership structure and deposits structure might affect risk disclosure differently. Originality/value The findings suggest many policy implications. First, regulators have to improve corporate governance mechanisms in Islamic banking system through the optimization of ownership structure (dispersed ownership) to promote transparency and disclosure. Second, regulators and policymakers should revise guidelines in the main purpose to protect PSIAs holders (considered as minor shareholders without voting power) through promoting disclosure and transparency. Third, the findings can be useful for many international supervisory bodies such as the IFSB and AAOIFI to evaluate transparency and disclosure standards.

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“…The results of prior studies on the association between board composition and corporate disclosure have provided conflicting results. Some studies, Mousa and Elamir (2014), Haniffa and Cooke (2002) and Vandemele et al (2009), found no relationship between the two variables. While Samaha et al (2012), Ezat and El-Masry (2008) and Samaha et al (2015) found a positive relationship between them.…”

Section: Determinants Of Internet Risk Disclosurementioning

confidence: 95%

The determinants of internet risk disclosure: empirical study of Egyptian listed companies

Khalil

Maghraby

2017

MAJ

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Purpose The purpose of this paper is to contribute to the existing disclosure literature by examining the determinants of corporate risk disclosure (CRD) in the internet reporting for a sample of Egyptian listed companies on the Egyptian Stock Exchange (EGX). Design/methodology/approach This study depends on a sample of 76 Egyptian companies included in the EGX 100 in the period 2012-2014. The study applies a content analysis and uses a sentence-based method to measure CRD in the internet reporting. Ordinary least-squares regression analysis is used to examine the impact of firm and board characteristics on CRD in the internet reporting. Findings The empirical analysis shows that large Egyptian companies tend to disclose more risk information in their internet reporting. Moreover, the results indicate that there is a significant positive association between sector type and CRD in the internet reporting. The results show non-significant association between CRD and other firm characteristics (cross listing and level of risk). Finally, there are no significant associations between CRD and board characteristics variables (board size, board composition and CEO duality). Research limitations/implications The study’s findings have practical implications. It aids in informing policy makers considering implementing new economic reform programs about the properties of Egyptian companies that disclose risk information in their internet reporting. It provides insights on CRD in Egyptian companies for standards setters and professional authorities to improve risk reporting practices to help stakeholders in making good decisions. Originality/value This study is one of the first studies to examine the determinants of CRD in the internet reporting for a sample of Egyptian companies.

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The effect of governance mechanisms on the quality of risk disclosure: using bootstrap techniques

Cited by 14 publications

References 45 publications

What drives risk disclosure in Islamic and conventional banks? An international comparison

What drives risk disclosure in Islamic and conventional banks? An international comparison

Do ownership structures affect risk disclosure in Islamic banks? International evidence

The determinants of internet risk disclosure: empirical study of Egyptian listed companies

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