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Role of corporate governance in mitigating the selective disclosure of executive stock option information

Nelson, Jodie E., Gallery, Gerry T., & Percy, Majella (2010) Role of corporate governance in mitigating the selective disclosure of executive stock option information. Accounting and Finance.

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Abstract

We examine the nature and extent of statutory executive stock option (ESO) disclosures by Australian listed companies over the 2001 to 2004 period, and the influence of corporate governance mechanisms on these disclosures. Our results show a progressive increase in overall compliance from 2001 to 2004. However, despite the improved compliance, the results reveal managements’ continued reluctance to disclose more sensitive ESO information. Factors associated with good internal governance, including board independence, audit committee independence and effectiveness, and compensation committee independence and effectiveness are found to contribute to improved compliance. Similarly, certain external governance factors are associated with improved disclosure, including external auditor quality, shareholder activism (as proxied by companies identified as poor performers by the Australian Shareholders’ Association), and regulatory intervention.

Impact and interest:

4 citations in Scopus
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2 citations in Web of Science®

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ID Code: 32160
Item Type: Journal Article
Keywords: Executive stock options, Selective disclosure, Compliance, Corporate governance
DOI: 10.1111/j.1467-629X.2009.00339.x
ISSN: 1467-629X
Subjects: Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > ACCOUNTING AUDITING AND ACCOUNTABILITY (150100) > Accounting Theory and Standards (150101)
Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > ACCOUNTING AUDITING AND ACCOUNTABILITY (150100) > Auditing and Accountability (150102)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Accountancy
Copyright Owner: © 2010 Accounting and Finance Association of Australia and New Zealand
Deposited On: 12 May 2010 08:20
Last Modified: 01 Mar 2012 00:20

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