Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosures
Purpose – This study examines the moderating effects of low and high levels of voluntary disclosures (VDs) between corporate governance and information asymmetry (IA). Design/methodology/approach – The study used PROCESS macro to construct bootstrap confidence intervals at the 95% level to estimate...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
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Emerald Publishing
2023-03-01
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| Series: | Journal of Asian Business and Economic Studies |
| Subjects: | |
| Online Access: | https://www.emerald.com/insight/content/doi/10.1108/JABES-07-2021-0085/full/pdf |
| _version_ | 1797789092548706304 |
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| author | Samya Tahir Sadaf Ehsan Mohammad Kabir Hassan Qamar Uz Zaman |
| author_facet | Samya Tahir Sadaf Ehsan Mohammad Kabir Hassan Qamar Uz Zaman |
| author_sort | Samya Tahir |
| collection | DOAJ |
| description | Purpose – This study examines the moderating effects of low and high levels of voluntary disclosures (VDs) between corporate governance and information asymmetry (IA). Design/methodology/approach – The study used PROCESS macro to construct bootstrap confidence intervals at the 95% level to estimate the model, and “simple slope analysis” to visualize the model. Findings – The better corporate governance provides a monitoring mechanism that disseminates private information and reduces IA. The effect of corporate governance on IA is contingent on the levels of VDs within a firm, and this relationship is strengthened when the level of VDs within a firm is high, and results remain consistent when levels of sub-indices are high. Additional analysis reveals that effective boards and audit committees reduce IA. Increased inside, an associated company, family and foreign ownership exacerbate IA, whereas institutional owners act as effective monitors to overcome informational disadvantages. Practical implications – The findings provide implications for policymakers to promote corporate governance and more relevant reporting practices as effective mechanisms for protecting shareholders' rights and attenuating IA in capital markets. Originality/value – The study is valuable to understand the strength of the relationship between corporate governance and information asymmetries based on the moderating role of different VD levels. |
| first_indexed | 2024-03-13T01:44:54Z |
| format | Article |
| id | doaj.art-9f415e7d279a400fb80b9695836eb5db |
| institution | Directory Open Access Journal |
| issn | 2515-964X |
| language | English |
| last_indexed | 2024-03-13T01:44:54Z |
| publishDate | 2023-03-01 |
| publisher | Emerald Publishing |
| record_format | Article |
| series | Journal of Asian Business and Economic Studies |
| spelling | doaj.art-9f415e7d279a400fb80b9695836eb5db2023-07-03T09:17:25ZengEmerald PublishingJournal of Asian Business and Economic Studies2515-964X2023-03-0130122510.1108/JABES-07-2021-0085Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosuresSamya Tahir0Sadaf Ehsan1Mohammad Kabir Hassan2Qamar Uz Zaman3Management Sciences, COMSATS University Islamabad - Lahore Campus, Lahore, PakistanManagement Sciences, COMSATS University Islamabad - Lahore Campus, Lahore, PakistanEconomics and Finance, University of New Orleans, New Orleans, Louisiana, USACOMSATS University Islamabad - Sahiwal Campus, Sahiwal, PakistanPurpose – This study examines the moderating effects of low and high levels of voluntary disclosures (VDs) between corporate governance and information asymmetry (IA). Design/methodology/approach – The study used PROCESS macro to construct bootstrap confidence intervals at the 95% level to estimate the model, and “simple slope analysis” to visualize the model. Findings – The better corporate governance provides a monitoring mechanism that disseminates private information and reduces IA. The effect of corporate governance on IA is contingent on the levels of VDs within a firm, and this relationship is strengthened when the level of VDs within a firm is high, and results remain consistent when levels of sub-indices are high. Additional analysis reveals that effective boards and audit committees reduce IA. Increased inside, an associated company, family and foreign ownership exacerbate IA, whereas institutional owners act as effective monitors to overcome informational disadvantages. Practical implications – The findings provide implications for policymakers to promote corporate governance and more relevant reporting practices as effective mechanisms for protecting shareholders' rights and attenuating IA in capital markets. Originality/value – The study is valuable to understand the strength of the relationship between corporate governance and information asymmetries based on the moderating role of different VD levels.https://www.emerald.com/insight/content/doi/10.1108/JABES-07-2021-0085/full/pdfVoluntary disclosureCorporate governanceInformation asymmetry |
| spellingShingle | Samya Tahir Sadaf Ehsan Mohammad Kabir Hassan Qamar Uz Zaman Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosures Journal of Asian Business and Economic Studies Voluntary disclosure Corporate governance Information asymmetry |
| title | Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosures |
| title_full | Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosures |
| title_fullStr | Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosures |
| title_full_unstemmed | Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosures |
| title_short | Does corporate governance compliance condition information asymmetries? Moderating role of voluntary disclosures |
| title_sort | does corporate governance compliance condition information asymmetries moderating role of voluntary disclosures |
| topic | Voluntary disclosure Corporate governance Information asymmetry |
| url | https://www.emerald.com/insight/content/doi/10.1108/JABES-07-2021-0085/full/pdf |
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