A Case Study of Voluntary Disclosure by Chinese Enterprises

  • Chun Yip Desmondy Yuen Unversity of Macau
  • Zhang Xu Steven University of Macau
  • Liu Ming Morris University of Macau
  • Vanessa Chan Lu University of Macau
DOI: https://doi.org/10.5296/ajfa.v1i2.121

Abstract

This study examines the impact of companies’ ownership features, corporate governance mechanisms, and firm-specific characteristics on the voluntary disclosure provided by publicly-listed companies on the Shanghai Stock Exchange Market in China. The features of  ownership structure and corporate governance mechanisms include (1) ownership concentration; (2) ownership by state and state-related institutions; (3) individual ownership; (4) the chief executive officer is also the chairman of the board of directors; (5) independence of the board, and (6) existence of an audit committee.  The firm-specific characteristics are (1) firm size; (2) leverage; (3) profitability, and (4) type of industry. With the use of a relative disclosure index for measuring the voluntary disclosure level, our results indicate that individual ownership, the existence of an audit committee, firm size, and leverage are significantly related to the extent of voluntary disclosure. The study provides empirical evidence for policy makers and regulators in China for improving corporate governance mechanisms and the transparency of publicly-listed companies. The findings also contribute to an understanding of disclosure behavior among former wholly state-owned enterprises during the privatization process in China.

JEL Classifications: M40, M41, M48

Author Biographies

Chun Yip Desmondy Yuen, Unversity of Macau
Associate Professor in Accounting, University of Macau.
Zhang Xu Steven, University of Macau
Assistant Professor in Accounting
Liu Ming Morris, University of Macau
Assistant Professor in Accounting
Vanessa Chan Lu, University of Macau
Graduate Assistant
Published
2010-05-02
Issue
Vol. 1 No. 2 (2009)
Section
Research Articles

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