The impact of the Tunisian Revolution and internal governance mechanisms on the extent of voluntary information disclosure

Abstract

Purpose This study aims to investigate, on the one hand, the impact of the Tunisian Revolution and internal governance mechanisms (especially, the ownership structure and the board of directors structure on the extent of voluntary information disclosure [VID]) and on the other hand, the moderating effect of the Tunisian Revolution on the relationship between the internal corporate governance mechanisms and the VID. Design/methodology/approach A content analysis of 362 annual reports is used for determining the level of VID. This study covers a 10-year period (2007-2016) which is divided into two sub-periods (before and after the Tunisian Revolution). The generalized least squares regression model was used to investigate the effect of the Tunisian Revolution, ownership structure and the board of directors structure on the VID. Findings The Tunisian companies disclose less voluntary information after the Tunisian Revolution because of a decrease in the disclosure of information related to results, intangible assets, non-financial information and management’s discussion and analysis. The authors’ findings highlight the importance of the moderating effect of the revolution. After the Tunisian Revolution, a positive relationship was found, on the one hand, between institutional ownership, board size and board independence, and the VID on the other hand. Besides, companies with dual structures and with a high level of foreign ownership are less reluctant to the VID. Moreover, different governance mechanisms are related to different types of information disclosed. These relationships were affected by the Tunisian Revolution. Practical implications This piece of research could be useful for managers, investors and different stakeholders. It can help managers in improving their VID and thus their companies’ transparency, mainly in developing countries and in times of crisis. Moreover, it could be helpful for investors and stakeholders for their decision-making, especially in crisis periods. Originality/value This study contributes to the literature by investigating the VID in a developing country and in times of crisis. It widens knowledge by analyzing the types of voluntary information disclosed. It is one of the few pieces of research investigating this issue. Moreover, it is the first research analyzing the consequences on the VID of the revolutions in the Arab countries that have experienced an Arab Spring Revolution.

Drivers of corporate voluntary disclosure: a systematic review

“…In the sample literature, 41 studies take governance attributes into consideration as a deriver of corporate disclosure practices with board size to be the most examined factor; some other studies investigated the overall governance index. As presented in Table 6, the general impact of overall corporate governance quality and its mechanisms on the disclosure practices of corporations is documented to have a positive direction (Gómez and García, 2020; Jamil et al , 2020; Mekaoui et al , 2020; Alnabsha et al , 2018); nevertheless, there are some studies failed to support this evidence. For example, board independence has been found to enhance VD as it places pressure on executives to reveal more data and avoid agency cost (Shamil et al , 2014; Yusoff et al , 2019); other studies found this impact to be a negative or insignificant (Nguyen and Nguyen, 2020; Alotaibi and Hussainey, 2016).…”

Can Crisis Periods Affect the ESG Reporting Scope? The Portuguese Euronext Entities Case

“…Given the market's volatility in the capitalist system, the crisis effects on non-financial accounts should not be overlooked (Bogataya et al 2022;Bretos et al 2018;Jiménez-Yáñez and Fontrodona 2022;Perez et al 2017;Velte and Stawinoga 2017;Warren-Myers 2016); for example, the COVID-19 crisis (Brand et al 2022;Johann 2022;Białkowski and Sławik 2022;Bifulco et al 2023;Bodhanwala and Bodhanwala 2023;Demers et al 2021;Dyczkowska et al 2022;Dragomir et al 2022;Kaakeh and Gokmenoglu 2022;Kuswantoro et al 2022;Moalla and Dammak 2023;Poursoleyman et al 2022;Pozzoli et al 2022;Sidaway et al 2022;Sharma et al 2021), the environmental crises (Boiral et al 2022;Corazza et al 2020;Egbon and Mgbame 2020;Indrasari et al 2022;Mora Rodríguez et al 2020;Skärin et al 2022), the legitimacy crises (Aureli et al 2017;Beck et al 2017;Mekaoui et al 2020;Parsons 2019), war and post-war (Dissanayake and Samarathunga 2021;Thoradeniya et al 2022), the communication crisis (Meintjes and Grobler 2014;Park et al 2020), the social crisis (Maroun 2018), and the management crisis (Stratulat 2019).…”