Governance Structures, Voluntary Disclosures and Public Accountability: The Case of UK Higher Education Institutions

Accounting, Auditing and Accountability Journal, September 2015 Forthcoming

47 Pages Posted: 25 Sep 2015 Last revised: 13 Oct 2015

See all articles by Collins G. Ntim

Collins G. Ntim

University of Southampton Business School, UK; University of Southampton

Teerooven Soobaroyen

University of Essex - Essex Business School

Martin Broad

University of Southampton - School of Management

Date Written: September 24, 2015

Abstract

Purpose: We investigate the extent of voluntary disclosures in UK higher education institutions’ (HEIs) annual reports and examine whether internal governance structures influence disclosure in the period following major reform and funding constraints.

Design/Methodology/Approach: We adopt a modified version of Coy and Dixon’s (2004) public accountability index, referred to in this paper as a public accountability and transparency index (PATI), to measure the extent of voluntary disclosures in 130 UK HEIs’ annual reports. Informed by a multi-theoretical framework drawn from public accountability, legitimacy, resource dependence and stakeholder perspectives, we propose that the characteristics of governing and executive structures in UK universities influence the extent of their voluntary disclosures.

Findings: We find a large degree of variability in the level of voluntary disclosures by universities and an overall relatively low level of PATI (44%), particularly with regards to the disclosure of teaching/research outcomes. We also find that audit committee quality, governing board diversity, governor independence, and the presence of a governance committee are associated with the level of disclosure. Finally, we find that the interaction between executive team characteristics and governance variables enhances the level of voluntary disclosures, thereby providing support for the continued relevance of a ‘shared’ leadership in the HEIs’ sector towards enhancing accountability and transparency in HEIs.

Research Limitations/Implications: In spite of significant funding cuts, regulatory reforms and competitive challenges, the level of voluntary disclosure by UK HEIs remains low. Whilst the role of selected governance mechanisms and ‘shared leadership’ in improving disclosure, is asserted, the varying level and selective basis of the disclosures across the surveyed HEIs suggest that the public accountability motive is weaker relative to the other motives underpinned by stakeholder, legitimacy and resource dependence perspectives.

Originality/Value: This is the first study which explores the association between HEI governance structures, managerial characteristics and the level of disclosure in UK HEIs.

Keywords: governance; voluntary disclosure; public accountability index; higher education; annual reports.

JEL Classification: G32; G34; M41

Suggested Citation

Ntim, Collins G. and Soobaroyen, Teerooven and Broad, Martin, Governance Structures, Voluntary Disclosures and Public Accountability: The Case of UK Higher Education Institutions (September 24, 2015). Accounting, Auditing and Accountability Journal, September 2015 Forthcoming, Available at SSRN: https://ssrn.com/abstract=2664947

Collins G. Ntim (Contact Author)

University of Southampton Business School, UK ( email )

Southampton Business School
Highfield
Southampton, England SO17 IBJ
United Kingdom
+44 (0) 238059 4285 (Phone)
+44 (0) 238059 3844 (Fax)

HOME PAGE: http://www.southampton.ac.uk/business-school/about/staff/cgn1n11.page

University of Southampton ( email )

Southampton, SO17 1BJ
United Kingdom

Teerooven Soobaroyen

University of Essex - Essex Business School ( email )

Wivenhoe Park
Colchester, CO4 3SQ
United Kingdom
01206874015 (Phone)
01206874015 (Fax)

Martin Broad

University of Southampton - School of Management ( email )

Highfield
Southampton S017 1BJ, Hampshire SO17 1BJ
United Kingdom
+44 0 23 8059 7791 (Phone)
+44 0 23 8059 3844 (Fax)

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