PurposeThis paper aims to examine the influence of corporate governance mechanisms on the extent of intellectual capital (IC) disclosure among companies listed on the Kuwait Stock Exchange (KSE).Design/methodology/approachA content analysis approach was used. The association between dependent and independent variables was examined using multiple regression analysis.FindingsThe results suggest that corporate governance mechanisms strongly influence the quantity of IC information disclosed in the annual reports of KSE-listed companies. Specifically, companies with larger boards, higher proportions of external directors and higher blockholder ownership are associated with higher levels of IC disclosure.Practical implicationsThe findings highlight the effectiveness of corporate governance mechanisms in promoting IC disclosure. They are a useful guideline for regulators, company management and shareholders regarding corporate governance mechanisms that influence the extent of IC disclosure. Given recent Kuwaiti Government initiatives to promote transparency and the informational efficiency of the stock market, this research provides timely empirical evidence in support of these initiatives.Originality/valueIn the frontier market context, the study contributes to a theoretical understanding of the corporate reporting of IC and the relationship between IC disclosure and corporate governance mechanisms. The findings provide empirical support for the theoretical notion that effective corporate governance plays an important role in increasing the extent of voluntary disclosure.
Humanomics – Emerald Publishing
Published: Feb 12, 2018