Board Composition, Board Committees, Firm Characteristics and Voluntary Disclosure: Evidence from Palestinian listed companies

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Abdelhaq, Raed Imad
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An-Najah National University
The purpose of this study is to investigate the extent and nature of voluntary disclosure (VD) of the Palestinian companies listed on the Palestine Exchange (PEX). Furthermore, the impact of board composition, board committees and firm characteristics on the level of VD is examined. Data was collected from a sample of 45 companies' annual reports -which constitute 93.7% of Palestinian listed companies- for the period 2013-2017. In order to measure VD, a disclosure index including 55 items of voluntary information was constructed and applied. To achieve the objectives of the study, multiple regression was used. The results of the study reveal that, on average, a company discloses 56.31% of the items included in the disclosure index. In addition, a significant positive relationship between board gender diversity, audit committee, governance committee, nomination and compensation committee and firm size and VD exists. In contrast, there is a significant negative relationship between board size, CEO duality and VD. Furthermore, board independence, director ownership, ownership concentration, financial leverage, firm profitability, audit firm and firm age were found to have no effect on VD. The study recommends that policy makers and regulators are encouraged to establish an official Palestinian VDI that can be used to evaluate and compare voluntary practice and disclosure among Palestinian companies. Furthermore, the policy makers and managers have to motivate the presence of board committees in companies and activate their rules.
Voluntary disclosure , Board composition , Board committees , Firm Characteristics , PEX