TY - JOUR

T1 - Ownership concentration and Covid-19 disclosure: the mediating role of corporate leverage

AU - Albitar, Khaldoon

AU - Elmarzouky, Mahmoud

AU - Hussainey, Khaled

PY - 2022/6/14

Y1 - 2022/6/14

N2 - PurposeThis paper aims to examine the impact of ownership concentration on Covid-19 disclosure in the narrative sections of corporate annual reports. It also explores the mediating role of corporate leverage on the ownership concentration–Covid-19 disclosure relationship.Design/methodology/approachThis paper uses automated textual analysis to measure Covid-19 disclosure in annual reports. It also applies different regression models to test the research hypotheses and to address the endogeneity problem. It uses univariate and multivariate analyses through correlations and ordinary least squares.FindingsThe analysis shows that ownership concentration has a negative impact on Covid-19 disclosure. It also shows that corporate leverage negatively affects Covid-19 disclosure, and it has a partial mediating effect on the ownership concentration–Covid-19 disclosure relationship.Practical implicationsThe results offer important practical implications for the government, management, shareholders and policymakers. For example, corporate managers are encouraged to consider small shareholders’ interests and provide a sufficient level of Covid-19 disclosure to avoid violating their rights. Also, the government may consider forming a mechanism for balancing the ownership structure to protect small investors and weaken large shareholders’ tunnelling behaviours.Originality/valueThis paper offers two important contributions to governance and disclosure literature. First, it provides new empirical evidence on the relationship between ownership concentration and Covid-19 disclosure. Second, it provides new evidence on the mediating role of the leverage ratio on the ownership concentration–Covid-19 disclosure relationship.

AB - PurposeThis paper aims to examine the impact of ownership concentration on Covid-19 disclosure in the narrative sections of corporate annual reports. It also explores the mediating role of corporate leverage on the ownership concentration–Covid-19 disclosure relationship.Design/methodology/approachThis paper uses automated textual analysis to measure Covid-19 disclosure in annual reports. It also applies different regression models to test the research hypotheses and to address the endogeneity problem. It uses univariate and multivariate analyses through correlations and ordinary least squares.FindingsThe analysis shows that ownership concentration has a negative impact on Covid-19 disclosure. It also shows that corporate leverage negatively affects Covid-19 disclosure, and it has a partial mediating effect on the ownership concentration–Covid-19 disclosure relationship.Practical implicationsThe results offer important practical implications for the government, management, shareholders and policymakers. For example, corporate managers are encouraged to consider small shareholders’ interests and provide a sufficient level of Covid-19 disclosure to avoid violating their rights. Also, the government may consider forming a mechanism for balancing the ownership structure to protect small investors and weaken large shareholders’ tunnelling behaviours.Originality/valueThis paper offers two important contributions to governance and disclosure literature. First, it provides new empirical evidence on the relationship between ownership concentration and Covid-19 disclosure. Second, it provides new evidence on the mediating role of the leverage ratio on the ownership concentration–Covid-19 disclosure relationship.

U2 - 10.1108/IJAIM-10-2021-0202

DO - 10.1108/IJAIM-10-2021-0202

M3 - Article

VL - 30

SP - 339

EP - 351

JO - International Journal of Accounting and Information Management

JF - International Journal of Accounting and Information Management

SN - 1834-7649

IS - 3

ER -