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A Case Study of Voluntary Disclosure by Chinese Enterprises

Author

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  • Chun Yip Desmondy Yuen
  • Zhang Xu Steven
  • Liu Ming Morris
  • Vanessa Chan Lu

Abstract

This study examines the impact of companies’ ownership features, corporate governance mechanisms, and firm-specific characteristics on the voluntary disclosure provided by publicly-listed companies on the Shanghai Stock Exchange Market in China. The features of ownership structure and corporate governance mechanisms include (1) ownership concentration; (2) ownership by state and state-related institutions; (3) individual ownership; (4) the chief executive officer is also the chairman of the board of directors; (5) independence of the board, and (6) existence of an audit committee. The firm-specific characteristics are (1) firm size; (2) leverage; (3) profitability, and (4) type of industry. With the use of a relative disclosure index for measuring the voluntary disclosure level, our results indicate that individual ownership, the existence of an audit committee, firm size, and leverage are significantly related to the extent of voluntary disclosure. The study provides empirical evidence for policy makers and regulators in China for improving corporate governance mechanisms and the transparency of publicly-listed companies. The findings also contribute to an understanding of disclosure behavior among former wholly state-owned enterprises during the privatization process in China. Keywords- Voluntary disclosure, Corporate governance, Audit committee, Disclosure index, Firm-specific characteristic JEL Classifications- M40, M41, M48

Suggested Citation

  • Chun Yip Desmondy Yuen & Zhang Xu Steven & Liu Ming Morris & Vanessa Chan Lu, 2009. "A Case Study of Voluntary Disclosure by Chinese Enterprises," Asian Journal of Finance & Accounting, Macrothink Institute, vol. 1(2), pages 118145-1181, December.
    • Handle: RePEc:mth:ajfa88:v:1:y:2009:i:2:p:118-145
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    2. Ibrahim Mohd Al Hamadsheh & Barjoyai Bin Bardai & Abdoul Rahman Mhd Al Jounaidi, 2020. "The Mediatory Effect of Voluntary Disclosure on the Relationship between Corporate Governance and Financial Performance: A Pilot Study," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 4(7), pages 325-331, July.

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    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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