Ownership structure, corporate risk disclosure and firm value: a Malaysian perspective

Kamaruzaman, Siti Aisyah; Ali, Mazurina Mohd; Ghani, Erlane K; Gunardi, Ardi

doi:10.1504/ijmfa.2019.099766

Cited by 22 publications

(14 citation statements)

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“…Prior studies (e.g. Donnelly and Mulcahy, 2008;Kamaruzaman et al, 2019) claim that institutional investors play an active role in minimising information asymmetry and demand greater voluntary disclosures as they possess relatively more business and technical know-how as well as bargaining power. In contrast, there is an argument that institutional investors can negotiate with the firms to have direct access to private information.…”

Section: Control Variablesmentioning

confidence: 99%

Voluntary cybersecurity disclosure in the banking industry of Bangladesh: does board composition matter?

Mazumder

Hossain

2022

JAEE

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PurposeCybersecurity disclosure (CSD) provides users with valuable information and significant insights about a firm's susceptibility to cyber risk and its management. It is argued that the board of directors, with its oversight role, should be vigilant in managing cyber risk and disclosures. This study aims to measure the extent of CSD of the banking companies and examines the association between the characteristics of board composition (i.e. board size, board independence and gender diversity) and CSD.Design/methodology/approachThis study adopted automated content analysis to find out the extent of CSD in the listed commercial banks of an emerging country, Bangladesh, where CSD is voluntary. Further, multiple linear regression is applied to determine the relationship between board composition and CSD.FindingsThe findings reveal an increasing trend of CSD over the sample period (2014–2020). The study confirms a significant positive relationship between board independence and CSD. The study also demonstrates that the higher presence of female directors on the board is associated with higher CSD. However, no consistently significant relationship is found between board size and CSD.Research limitationsThe study is based on listed banking companies only. Hence, the results can not be generalised to companies in other sectors. Also, it is important to acknowledge that we focused on the quantity (not the quality) of CSD contained in annual reports.Practical implicationsThe study provides an overall understanding of current trends of CSD in the Banking sector of a developing country. Regulators may use our findings to understand the current level of CSD and assess the need for issuing guidance in this regard. The association between board composition and CSD has implications both for banks when selecting board members and policymakers when establishing requirements concerning board composition under corporate governance guidelines.Originality/valueThis is one of the very few studies in the context of an emerging economy where CSD is voluntary. The paper contributes to a narrow stream of research investigating CSD and its association with board composition. Notably, it contributes to understanding how board composition is associated with CSD in the banking industry, which is highly exposed to cyber risk.

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Section: Control Variablesmentioning

confidence: 99%

Voluntary cybersecurity disclosure in the banking industry of Bangladesh: does board composition matter?

Mazumder

Hossain

2022

JAEE

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“…As a result, the authors suggest that the primary purpose of corporate innovations is the enhancement in firms' organisational capability. Corporate innovations, therefore, can be measured by the presence of formal processes and structures which help foster corporate innovations; the number of new competencies i.e., distinctive knowledge and skill domains which facilitate corporate innovations; the effectiveness of employee training on corporate innovations i.e., the quality of training and guidance on how to evaluate the market potential of a new idea; the number of new-to-firm opportunities in new markets; the number of corporate innovations which noticeably advance current markets, to name just a few (Kamaruzaman, Ali, Ghani, & Gunardi, 2019;Del Giudice, Maggioni., Romano, & Nicotra, 2014;Becker and Dietz, 2009;Jafari-Sadeghi 2020). According to Becker and Dietz (2009), although it is much more difficult to measure corporate innovations by utilising these measures, they can help measure corporate innovations more precisely.…”

Section: Corporate Innovations and Its Measurementmentioning

confidence: 99%

The potential link between corporate innovations and corporate competitiveness: evidence from IT firms in the UK

Sukumar

Jafari‐Sadeghi

García-Pérez

et al. 2020

JKM

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Purpose The purpose of this paper is to provide a thorough empirical investigation of the potential link between corporate innovations and corporate competitiveness in the context of the UK IT industry. Design/methodology/approach This research uses a panel of 216 UK IT firms for the period from 2000 to 2016. The sample data for this study were extracted from the Worldscope, extracted from the Datastream database from Thomson Reuters. For the analysis of the data, the generalised method of moments model is applied. Findings The results of this study provide empirical evidence that there exists a strong, positive link between corporate innovations and corporate competitiveness. Such evidence further reinforces the common view in the current literature of strategic management that because of the nature of their business, firms in the IT industry need to enhance their innovative capacities on a continual basis because of their critical role on these firms’ success and survival. Also, it is found that when the proxies for corporate innovations are lagged by two periods, their impact on corporate competitiveness becomes relatively more significant. However, when they are further lagged, i.e. by three periods, such an impact turns out to be relatively less pronounced. Research limitations/implications The data gathered for this paper was restricted to IT-oriented firms in the UK. Using a secondary database (Datastream), the paper considered the period of 2000-2016. Originality/value The research makes a significant contribution to the current debate on the relationship between information technology, innovation and performance, referred to in the literature as the productivity paradox, by studying the problem in the IT industry. It supports organisations from the sector in their efforts to deal with the dynamic nature of technological innovations and of the context where they operate. Methodologically, the way the study has measured the concepts of innovation and performance and the lessons learned from their analysis has also brought value to the research.

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“…Therefore, hypothesis 1, which predicted a positive association between corporate value and risk disclosure, was not supported. This result supports the outcomes of several previous empirical studies (i.e.,Hassan et al, 2009;Kamaruzaman et al, 2019) that found an adverse association between risk disclosure and corporate value. However, these results contrast those reported in some previous studies (i.e.…”

mentioning

confidence: 99%

Does the Board Independence Influence the Association Between Risk Disclosure and Firm Value? Evidence From Jordan

Makhlouf

Oroud

Soda

2020

HSSR

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Purpose of the study: This paper aimed to investigate the influence of risk disclosure on corporate value and investigate whether the effect of risk disclosure on corporate value is moderated by the level of independence of boards of directors. Methodology: Using an analysis of annual reports, the study depended on a set of balanced panel data derived from 13 banks listed on the “Amman Stock Exchange” (ASE) from 2014 to 2018. Main Findings: The empirical results indicated that the association between risk disclosure and the corporate value was significant but negative. To examine the influence of the moderating variable, hierarchical regression models were used. The results regarding the moderating effect indicate that board independence (BI) positively moderated the association between risk disclosure and corporate value. Applications of this study: The findings of this article can provide insights into the association between risk disclosure and corporate value and the moderating influence of the board of directors' independence on this relationship. Novelty/Originality of this study: This study is particularly beneficial for understanding the importance of risk disclosure between the management and stakeholders as well as understanding the importance of the board of director composition in enhancing the influence of risk disclosure on corporate value. Moreover, this is the first study to investigate the moderating effect of board composition (represented by board independence) on the association between risk disclosure and corporate value.

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Ownership structure, corporate risk disclosure and firm value: a Malaysian perspective

Cited by 22 publications

References 0 publications

Voluntary cybersecurity disclosure in the banking industry of Bangladesh: does board composition matter?

Voluntary cybersecurity disclosure in the banking industry of Bangladesh: does board composition matter?

The potential link between corporate innovations and corporate competitiveness: evidence from IT firms in the UK

Does the Board Independence Influence the Association Between Risk Disclosure and Firm Value? Evidence From Jordan

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