Impact of Ownership Structure on Level of Voluntary Disclosure in Annual Reports: Comparison Between Listed Family-controlled and Nonfamily-controlled Companies in Malaysia

Syeliya Md Zaini, Umesh Prasad Sharma, Grant Samkin


This paper aims to investigate the level of voluntary disclosure in annual reports among listed companies in Malaysia by examining the impact of ownership structure. Both primary and secondary data were collected. A mixed methods approach was adopted to analyze the content and level of information disclosed voluntarily in companies’ annual report. This paper is developed within a voluntary disclosure framework and established through a Delphi technique approach. Detailed content analysis of voluntary disclosure in annual reports of 30 listed companies in Malaysia was employed. The secondary analysis investigated voluntary disclosure through interview sessions with annual report users. In general, family-controlled companies tend to voluntarily disclose in relation to external factors and global conditions. Often, most family-controlled companies provide financial warnings in their disclosure. This information is an indication to stakeholders that the company’s current performance is tacitly affected due to implications of external factors. Furthermore, disclosure within general corporate and strategic information, financial information, and corporate social responsibility are among information categories often provided by family-controlled companies. Besides that, stakeholders agreed that family-controlled companies in Malaysia are progressing toward better voluntary disclosure practices. This is regardless of the current level practised by those companies, which falls below the stakeholders’ expectations. Drawing from the interview analysis, characteristics of family-controlled companies can influence voluntary disclosure practices. This paper is limited to only 30 top listed companies in Malaysia. Nevertheless, this research provides avenues for policy makers, regulators, and public listed companies to collaborate for the improvement of corporate reporting and development of voluntary disclosure practice guidelines applicable in Malaysian family business context. Studies that examine voluntary disclosure practice by family-controlled companies in Malaysia is limited. As such, little is known about the effect of ownership structure on the level of voluntary disclosure. This paper contributes in filling this gap by examining companies’ annual report.

Aus. Aca. Acc & Fin. Rev Vol 3(3), Jul 2017, P 140-155


Voluntary Disclosure; Family-Controlled Companies; Information; Annual Report

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