Corporate Governance and the Informativeness of Disclosures in Australia: A Re-Examination
Lancaster University - Department of Accounting and Finance
Philip R. Brown
University of Western Australia - Department of Accounting and Finance; University of New South Wales - Australian School of Business; Lancaster University - Department of Accounting and Finance; Financial Research Network (FIRN)
Lancaster University Management School
August 31, 2012
We re-examine the association between corporate governance and corporate disclosures. Our sample comprises companies listed on the Australian Securities Exchange (ASX) that were rated in the annual Horwath/WHK Horwath Corporate Governance Reports. Panel data and firm fixed effects approaches are used to capitalise on the extended time series of governance data, and endogeneity is addressed through instrumental variables and models specified in first differences. We show better-governed Australian firms do indeed make more timely disclosures, but in a more subtle way than previously thought. Furthermore, we confirm that firms with higher governance ratings are priced more efficiently in the share market. Finally, we note it is still possible for firms to use governance structures to distinguish themselves despite a convergence in governance practices since the ASX’s regulatory intervention in 2003.
Number of Pages in PDF File: 36
Keywords: Corporate governance, Disclosure frequency, Price discovery, Timeliness
JEL Classification: G30, G38, M40working papers series
Date posted: September 1, 2012
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
This page was processed by apollo5 in 0.594 seconds