David Bourget (Western Ontario)
David Chalmers (ANU, NYU)
Rafael De Clercq
Jack Alan Reynolds
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Journal of Business Ethics 83 (3):543 - 563 (2008)
Recent years have featured a spate of regulatory action pertaining to the development and/or disclosure of corporate governance structures in response to financial scandals resulting in part from governance failures. During the same period, corporate governance activists and institutional investors increasingly have called for increased voluntary governance disclosure. Despite this attention, there have been relatively few comprehensive studies of governance disclosure practices and response to the regulation. In this study, we examine a sample of 50 U.S. firms and their public disclosure packages from 2004. We find a high degree of variability in the presentation and reporting format choices for many elements of the governance structure. This variability includes several items for which disclosure is mandated by regulators or legislative action. In particular, smaller firms offer fewer disclosures pertaining to independence, board selection procedures, and oversight of management (including whistleblowing procedures). There are also trends associated with board characteristics: boards that are less independent offer fewer disclosures of independence and management oversight matters. Moreover, large firms provide more disclosures of independence standards, board selection procedures, audit committee matters, management control systems, other committee matters, and whistleblowing procedures but do not appear to have a strictly superior information environment when compared to smaller firms. The findings raise questions about compliance with regulatory requirements and the degree to which conflicts of interest between managers and directors are being controlled. While there have been notable improvements in the information environment of governance disclosures, there remain structural issues that may possess negative ramifications for stakeholders.
|Keywords||disclosure corporate governance non-financial information governance reporting ethics SEC regulation|
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Citations of this work BETA
Susanne Arvidsson (2010). Communication of Corporate Social Responsibility: A Study of the Views of Management Teams in Large Companies. [REVIEW] Journal of Business Ethics 96 (3):339 - 354.
Hayden Teo & Donella Caspersz (2011). Dissenting Discourse: Exploring Alternatives to the Whistleblowing/Silence Dichotomy. [REVIEW] Journal of Business Ethics 104 (2):237-249.
Gladys Lee & Neil Fargher (2013). Companies' Use of Whistle-Blowing to Detect Fraud: An Examination of Corporate Whistle-Blowing Policies. [REVIEW] Journal of Business Ethics 114 (2):283-295.
Collins G. Ntim & Teerooven Soobaroyen (2013). Black Economic Empowerment Disclosures by South African Listed Corporations: The Influence of Ownership and Board Characteristics. [REVIEW] Journal of Business Ethics 116 (1):121-138.
Chris Mallin & Kean Ow-Yong (2010). The UK Alternative Investment Market — Ethical Dimensions. Journal of Business Ethics 95 (2):223 - 239.
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