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Internal Corporate Governance Mechanisms And Risk Disclosure: Evidence From Tunisia

Author

Listed:
  • Salem Boumediene
  • Fatma Ezzahra Abdallah
  • Salma Ben Moussa
  • Emna Boumediene

Abstract

Voluntary risk disclosure in the annual reports is increasingly becoming a more common corporate practice. This study aims to examine the impact of internal corporate governance mechanisms of Tunisian companies, on the quality and extent of risk disclosure. Using content analysis followed by a multivariate analysis of a sample of 170 company-year observations from 2011 to 2015, the results indicate that institutional, foreign, and government ownership negatively affect the extent of risk disclosure. However, ownership concentration has a positive effect on the extent of corporate risk disclosure. We also find that audit committee’s size has a positive effect on corporate risk disclosure. Finally, we show that board size has a positive effect on corporate risk disclosure, while the presence of woman within the board negatively affects the extent of corporate risk disclosure. Moreover, our analysis reveals that Tunisian companies tend to disclose mainly non-financial risk in their annual reports. Overall, the research provides a new channel through which internal corporate governance mechanisms impact financial reporting. This study contributes to and extends the literature on corporate risk by offering a new perspective on emerging countries’ disclosure of risk.

Suggested Citation

  • Salem Boumediene & Fatma Ezzahra Abdallah & Salma Ben Moussa & Emna Boumediene, 2022. "Internal Corporate Governance Mechanisms And Risk Disclosure: Evidence From Tunisia," Accounting & Taxation, The Institute for Business and Finance Research, vol. 14(1), pages 15-30.
    • Handle: RePEc:ibf:acttax:v:14:y:2022:i:1:p:15-30
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    References listed on IDEAS

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    More about this item

    Keywords

    Corporate Risk Disclosure; Ownership Structure; Board of Directors; Audit Committee;
    All these keywords.

    JEL classification:

    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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