Abstract

Dulacha G Barako

In recent years, the Kenyan Government has initiated reforms at the Nairobi Stock Exchange aimed at transforming the exchange into a vehicle for mobilising domestic savings and attracting foreign capital investments. Consequently, the corporate financial reporting, and in particular, the level of voluntary disclosure is a vital part of the process for building investor confidence (local and foreign) and trust. Drawing on prior corporate disclosure research, this study examines factors associated with voluntary disclosure of four types of information: general and strategic, financial, forward-looking, and social and board information in the annual reports of Kenyan companies. This study provides longitudinal examination of voluntary disclosure practices in the annual reports of listed companies in Kenya from 1992 to 2001. The study investigates the extent to which corporate governance attributes, ownership structure and company characteristics influence voluntary disclosure of various types of information. Due to the panel nature of our data, to estimate the determinants of voluntary disclosure of various types of information, we use pooled Ordinary Least Square (OLS) with Panel-Corrected Standard Errors (PCSEs). Our results indicate that, disclosures of all types of information are influenced by corporate governance attributes, ownership structure and corporate characteristics. In particular, the results also suggest that size and companies in the agricultural sector are significantly associated with the voluntary disclosure of all four types of information disclosures