SHS Web Conf.
Volume 36, 2017The 2016 4th International Conference on Governance and Accountability (2016 ICGA)
|Number of page(s)||14|
|Published online||24 July 2017|
The Determinants of Voluntary Risk Disclosures: The Case of Shariah Compliant Companies in Malaysia
* Faculty of Accountancy Universiti Teknologi MARA
1 Accounting Research Institute, Universiti Teknologi MARA
* Corresponding author’s email: firstname.lastname@example.org
Risk reporting is essential in notifying investors on how companies manage the risks they engage in. Even though companies nowadays release information through press releases, corporate websites, and other forms of communications, they still have to disclose more information in their annual reports. The objective of this study is to examine the determinants of voluntary risk disclosures of Shariah compliant companies (ShCCs) in Malaysia, focusing on the religiosity factor and the ownership structure. A quantitative analysis using secondary data was employed as a method to assess the annual reports of 116 Shariah compliant companies in Malaysia for the financial years of 2012 and 2013. The findings of this study reveal that the voluntary risk disclosures in ShCCs on average are not more than sixty per cent. This study indicates no relationship between the religiosity of board members and directors’ ownership to the level of voluntary risk disclosure. More importantly, this study finds the relationship between the existence of government ownership and voluntary risk disclosure in ShCCs. The study adds value to the current body of knowledge in voluntary risk disclosures and suggests the importance of risk management information in the annual reports of ShCCs as Malaysia grows as a leading country in the Islamic economy.
Key words: Voluntary Risk Disclosures / Corporate Governance / Shariah Compliant Companies / Risk Reporting / Malaysia
© The Authors, published by EDP Sciences, 2017
This is an Open Access article distributed under the terms of the Creative Commons Attribution License 4.0, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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