Influence of integrated reporting ratings, CEO age, and years of experience on the share price of top 106 JSE listed companies

Abstract

AUTHORSPatient Rambe Tonderayi B. Mangara ARTICLE INFOPatient Rambe and Tonderayi B. Mangara (2016). Influence of integrated reporting ratings, CEO age, and years of experience on the share price of top 106 JSE listed companies.Influence of integrated reporting ratings, CEO age, and years of experience on the share price of top 106 JSE listed companies Abstract Integrated corporate reporting (ICR), which entails the process of compiling, documenting and reporting on company's resources, its ongoing relationships with key stakeholders; business models; products (services); and the impact of such products (or services) on stakeholders, society, as well as the environment to optimize company value, has generated considerable interest among top 100 Johannesburg Stock Exchange (JSE) listed companies in South Africa over the last decade. Despite the surging interest in ICR to leverage the social responsibility, transparency and public accountability of companies in the developing African countries, little is known about the combined influence of ICR and internal company resources and/ capabilities (e.g., age and experience of the Chief Executive Officer (CEO)) on the performance of South African listed companies. The main objective of this study, therefore, is to examine the impact of Integrated Reporting Ratings (IRR); the company CEO's age; and his/her years as a CEO on the share price of the company within the South African context. The top-106 JSE listed companies for the period Year-end 2014 constitute the sample for this study. Multivariate non-parametric regression is used to model the relationship between the predictor (i.e., independent) variables and the response (i.e., dependent) variable using MATLAB. The model developed in this study is, then, used to evaluate the impact of IRR; the CEO's age and years of experience as CEO on the share price of individual companies. The proposed methodology is illustrated step-by-step. The finding of the study reveal that the share price of a company tended to increase with an increase in IRR, age and years of experience of the CEO, demonstrating that a company's established history in integrated reporting and corporate experience positively impact its performance (i.e., the share price).

A relação entre a aderência dos relatos integrados ao framework do IIRC e o desempenho econômico

“…Os resultados dessas pesquisas são inconclusivos, porém existem achados que mostram que a qualidade do RI está associada de forma positiva à avaliação das empresas (Q de Tobin) (Barth et al, 2017;Lee & Yeo, 2016), correspondendo a um aumento no preço de mercado das ações (Rambe & Mangara, 2016), na melhora da liquidez, na precisão de previsão dos analistas e na redução do custo de capital (Barth et al, 2017;Zhou et al, 2017).…”

“…Pesquisas anteriores investigaram a relação entre o nível de qualidade do Relato Integrado e o valor de mercado das empresas, o desempenho econômico e financeiro e a precisão de previsão dos analistas, no contexto sul africano (Rambe & Mangara, 2016;Barth, Cahan, Chen & Venter, 2017;Matemane & Wentzel, 2019). Já outros estudos, considerando uma amostra internacional mais ampla, investigaram o impacto da qualidade da divulgação do Relato Integrado no desempenho da empresa, em seu valor de mercado e em seu custo de capital (Pavlopoulos;Magnis & Iatridis, 2019;Vitolla;Salvi;Raimo;Petruzzella & Rubino, 2020).…”

A Study of CFO and CEO Attributes: Cash and Operating Cycles as Determinant Measures of Success

“…Similarly, in their research on the influence of individual executives on corporate financial reporting, Plöckinger, Aschauer, Hiebl, and Rohatschek (2016) noted that older CEOs are less often involved in fraudulent actions. Connecting age and experience with firm performance, Rambe and Mangara (2016) analyzed the impact of integrated reporting ratings (IRR), the CEO's age, and the individual's tenure as CEO on the company's share price. Their findings showed that share price of a company tends to increase with an increase in IRR, CEO age, and CEO years of experience (Rambe & Mangara, 2016).…”

“…Connecting age and experience with firm performance, Rambe and Mangara (2016) analyzed the impact of integrated reporting ratings (IRR), the CEO's age, and the individual's tenure as CEO on the company's share price. Their findings showed that share price of a company tends to increase with an increase in IRR, CEO age, and CEO years of experience (Rambe & Mangara, 2016). This leads to the argument that an older CFO will have more experience to manage the financial operations of a firm.…”

Evidenciação da responsabilidade social corporativa nos estudos sobre relato integrado: uma revisão estruturada da literatura

“…Existem diversas pesquisas que comprovam alguns benefícios elencados na literatura para adoção do RI, como redução no custo do capital (García-Sánchez & Nogueira-Gómez, 2017;Zhou et al, 2017), melhoria no preço da ação (Rambe & Mangara, 2016;Giorgino et al, 2017), aumento do lucro e do valor contábil (Baboukardos & Rimmel, 2016), ou ainda, na divulgação de RI com quali-dade, como melhoria na avalição da empresa e no processamento de informações (Lee & Yeo, 2016) e no valor da empresa, na liquidez, no fluxo de caixa futuro esperado e na eficiência dos investimentos (Barth et al, 2017).…”