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Voluntary corporate governance disclosures by post‐Apartheid South African corporations

Author

Listed:
  • Collins G. Ntim
  • Kwaku K. Opong
  • Jo Danbolt
  • Dennis A. Thomas

Abstract

Purpose - The purpose of this paper is to investigate as to whether post‐Apartheid South African (SA) listed corporations voluntarily comply with and disclose recommended good corporate governance (CG) practices and, if so, the major factors that influence such voluntary CG disclosure behaviour. Design/methodology/approach - The paper constructs a broad voluntary CG disclosure index containing 50 CG provisions from the 2002 King Report using a sample of 169 SA listed corporations from 2002 to 2006. The authors also conduct regression analysis to identify the main drivers of voluntary CG disclosure. Findings - The results suggest that while compliance with, and disclosure of, good CG practices varies substantially among the sampled companies, CG standards have generally improved over the five‐year period examined. The authors also find that block ownership is negatively associated with voluntary CG disclosure, while board size, audit firm size, cross‐listing, the presence of a CG committee, government ownership and institutional ownership are positively related to voluntary CG disclosure. Practical implications - These findings have important implications for policy‐makers and regulators. Evidence of improving CG standards implies that efforts by various stakeholders at improving CG standards in SA companies have had some positive impact on CG practices of SA firms. However, the substantial variation in the levels of compliance implies that enforcement may need to be strengthened further. Originality/value - There is a dearth of evidence on the level of compliance with the King Report. This study fills this gap by providing evidence for the first time on the level of compliance achieved, as well as contributing generally to the literature on compliance with codes of good governance and voluntary disclosure.

Suggested Citation

  • Collins G. Ntim & Kwaku K. Opong & Jo Danbolt & Dennis A. Thomas, 2012. "Voluntary corporate governance disclosures by post‐Apartheid South African corporations," Journal of Applied Accounting Research, Emerald Group Publishing Limited, vol. 13(2), pages 122-144, September.
    • Handle: RePEc:eme:jaarpp:v:13:y:2012:i:2:p:122-144
    DOI: 10.1108/09675421211254830
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    References listed on IDEAS

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    Cited by:

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    3. Muhammad Yar Khan & Anam Javeed & Ly Kim Cuong & Ha Pham, 2020. "Corporate Governance and Cost of Capital: Evidence from Emerging Market," Risks, MDPI, vol. 8(4), pages 1-29, October.
    4. Ntim, Collins G., 2011. "The Impact of Corporate Board Meetings on Corporate Performance in South Africa," MPRA Paper 45814, University Library of Munich, Germany.
    5. Tebogo Magang & Koketso Kube, 2018. "Compliance with Best Practice Governance Principles by State Owned Enterprises in Botswana," International Journal of Business and Management, Canadian Center of Science and Education, vol. 13(2), pages 149-149, January.
    6. AlHares, Aws & Ntim, Collins & King, David, 2018. "Block Ownership and Companies' R&D Intensity: The Moderating Effect Of Culture," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 15(2), pages 19-32.
    7. Samuel Buertey & Eun‐Jung Sun & Jang Soon Lee & Juhee Hwang, 2020. "Corporate social responsibility and earnings management: The moderating effect of corporate governance mechanisms," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(1), pages 256-271, January.
    8. Abdullah, Wan Amalina Wan & Percy, Majella & Stewart, Jenny, 2015. "Determinants of voluntary corporate governance disclosure: Evidence from Islamic banks in the Southeast Asian and the Gulf Cooperation Council regions," Journal of Contemporary Accounting and Economics, Elsevier, vol. 11(3), pages 262-279.
    9. Ntim, Collins G., 2016. "Corporate governance, corporate health accounting, and firm value: The case of HIV/AIDS disclosures in Sub-Saharan Africa," The International Journal of Accounting, Elsevier, vol. 51(2), pages 155-216.
    10. Collins G. Ntim, 2012. "Director shareownership and corporate performance in South Africa," African Journal of Accounting, Auditing and Finance, Inderscience Enterprises Ltd, vol. 1(4), pages 359-373.
    11. Collins G. Ntim & Kwaku K. Opong & Jo Danbolt, 2015. "Board size, corporate regulations and firm valuation in an emerging market: a simultaneous equation approach," International Review of Applied Economics, Taylor & Francis Journals, vol. 29(2), pages 194-220, March.
    12. Minga Negash & Tesfaye T. Lemma, 2020. "Institutional pressures and the accounting and reporting of environmental liabilities," Business Strategy and the Environment, Wiley Blackwell, vol. 29(5), pages 1941-1960, July.
    13. Dr. Baker Ahmad Aledwan & Dr. Omar Mohammed Zraqat & Dr. Lina Fuad Murwih Hussien, 2017. "The Impact of Ownership Structure on the Insurance Companies Applicability of Corporate Governance Instructions," Journal of Business & Management (COES&RJ-JBM), , vol. 5(3), pages 131-152, July.
    14. Maadi Bakor Omar & Azhar B Abdul Rahman & Fathilatul Zakimi bin Abdul Hamid, 2018. "The Association between Corporate Governance and Disclosure of Audit Committee Characteristics: A Conceptual Model for the Saudi Listed Companies," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 8(3), pages 325-335, July.
    15. Blanche Steyn & Farai Kwenda & Lesley Stainbank, 2020. "Do board-level controls matter? – An agency perspective on socially responsible investment (SRI) company boards in South Africa," South African Journal of Accounting Research, Taylor & Francis Journals, vol. 34(3), pages 205-235, September.
    16. M. V. Shivaani, 2018. "Does Regulatory Flexibility Affect Risk Disclosures in Annual Report?," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 19(4), pages 321-336, December.
    17. Collins Ntim & Teerooven Soobaroyen, 2013. "Black Economic Empowerment Disclosures by South African Listed Corporations: The Influence of Ownership and Board Characteristics," Journal of Business Ethics, Springer, vol. 116(1), pages 121-138, August.
    18. Dr. Madan Lal Bhasin, 2012. "Voluntary Corporate Governance Disclosures: Evidence From A Developing Country," Far East Journal of Psychology and Business, Far East Research Centre, vol. 9(2), pages 10-31, November.
    19. Khaleed Omair Alotaibi & Khaled Hussainey, 2016. "Determinants of CSR disclosure quantity and quality: Evidence from non-financial listed firms in Saudi Arabia," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 13(4), pages 364-393, November.
    20. Ala’ Hussein Albawwat & Mohamad Yazis Ali Basah, 2015. "The Impact of Shariah Approved Companies on the Relationship between Corporate Governance Structure and Voluntary Disclosure of Interim Financial Reporting in Jordan," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 5(2), pages 66-85, April.
    21. Collins Gyakari Ntim, 2012. "Does the South African stock market value an independent dual board leadership structure?," Economics and Business Letters, Oviedo University Press, vol. 1(1), pages 35-45.
    22. Ghazi Zouari & Kawther Dhifi, 2021. "The impact of board characteristics on integrated reporting: case of European companies," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 18(1), pages 83-94, March.

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