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The association between employee stock option disclosures and corporate governance: Evidence from an enhanced disclosure regime

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  • Bassett, Michael
  • Koh, Ping-Sheng
  • Tutticci, Irene

Abstract

This study examines the role of corporate governance in employee stock option (ESO) disclosures following the revision of AASB 1028 Employee Benefits in 2001. We find that, while firms do not fully comply with AASB 1028 ESO disclosures, they voluntarily provide other ESO disclosures. In relation to corporate governance measures that have a role in the financial reporting process, we find two corporate governance measures dominate our results—the quality of auditor and duality of the role of CEO and Chair of the Board of Directors. We show that, in general, external auditor quality has positive incremental association with both mandatory and voluntary ESO disclosures while the dual role of CEO and chairperson of the board is associated with lower levels of mandatory disclosure.

Suggested Citation

  • Bassett, Michael & Koh, Ping-Sheng & Tutticci, Irene, 2007. "The association between employee stock option disclosures and corporate governance: Evidence from an enhanced disclosure regime," The British Accounting Review, Elsevier, vol. 39(4), pages 303-322.
    • Handle: RePEc:eee:bracre:v:39:y:2007:i:4:p:303-322
    DOI: 10.1016/j.bar.2007.06.003
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