Ownership structure, management culture and risk reporting practices in Malaysia

摘要

Disclosure of risk management strategies provide useful information to investors and other stakeholders in evaluating management's effectiveness in dealing with business uncertainties and opportunities. Using the annual reports of 242 Malaysian listed companies, this study investigates the influence of ownership structure and management culture on risk reporting practices in 2008 and 2010. Quantity of risk disclosure is measured based on word count while quality of information disclosed is based on the timeliness and forward looking qualitative characteristics. Results of this study provide evidence that government ownership and management culture promote transparency and quality of risk information disclosed in annual reports. In contrast, there is no significant influence of family ownership on the quantity and quality of risk disclosures. These results indicate that different ownership groups affect managers' disclosure incentives differently. In addition, these results also provide compelling evidence of important links between management culture and promotion of transparency and quality of information disclosed even in agency setting characterized by concentrated ownership structure.