Effect of corporate voluntary disclosure on corporate performance: Evidence from a transitional economy
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Author(s)Mofijul Hoq MasumLink to ORCID Index: https://orcid.org/0000-0003-3173-2688
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Sarkar James BakulLink to ORCID Index: https://orcid.org/0009-0000-1329-8983
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Hassan Nazmul
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DOIhttp://dx.doi.org/10.21511/ppm.22(4).2024.31
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Article InfoVolume 22 2024, Issue #4, pp. 414-426
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Creative Commons Attribution 4.0 International License
Corporate performance is one of the core pillars of accelerating the economic growth of any economy. There are some direct and indirect components of corporate performance. This study is conducted to measure the impact of indirect factors, such as corporate voluntary disclosures, on corporate performance. A sample of 872 annual reports is investigated. A content analysis has been conducted to measure voluntary disclosure. The study employs the short panel data, fixed model regression, and Panel Corrected Standard Error (PCSE). The analysis indicates that corporate voluntary disclosure has influenced the return on assets with a regression coefficient of 0.0724 at p ≤ 0.01. Corporate voluntary disclosure in the transitional economy significantly influences corporate performance. However, the volume of corporate voluntary reporting in energy-related disclosure and climate-related disclosure is minimal, as the mean is only 2.21% and 2.31%. This implies that the government of the transitional economy may focus on persuading corporations to disclose additional information besides mandatory disclosure. In addition, indirect determinant of corporate performance, like corporate voluntary disclosure, brings sustainability to corporate performance, which further assists the transitional economy in shifting its economic status from one dimension to another.
Acknowledgment
The authors are very thankful to the Institute of Advanced Research, United International University, Bangladesh, for providing partial funds to complete this empirical study.
This project is partially funded by the Institute for Advanced Research Publication Grant of United International University, Ref. No.: IAR-2024-Pub-069.
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JEL Classification (Paper profile tab)M14, G30, L25
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References66
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Tables7
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Figures0
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- Table 1. Dimensions of voluntary disclosures
- Table 2. Measurement of variables
- Table 3. Descriptive statistics – Voluntary disclosure
- Table 4. Descriptive statistics – Control variables
- Table 5. Correlation matrix
- Table 6. Effect of corporate voluntary disclosure on corporate performance
- Table A1. Robustness test – Corporate voluntary disclosure and corporate performance
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