An examination of the association between international environmental factors and corporate voluntary disclosure practices

Purpose - This study examines the association between international environmental factors and corporate disclosure practices of non-financial companies listed on the Egyptian Stock Exchange (ESE). It uses seven international environmental factors, namely global competition, international socio-political institutions, international stock market, international accounting standards, global information technology and communication, and international financial institutions. Methodology/research design - The study uses the sample method in currying out the questionnaire in Egyptian listed companies. The sample consists of the top 100 non-financial companies listed on the Egyptian Stock Exchange (ESE). Financial listed companies were excluded from this study because they are subject to additional reporting regulationsFindings - Using regression analyses of data, we find that the average of the voluntary disclosure index of non-financial companies is 55 per cent. Overall, we observed a significant relationship between the overall voluntary disclosure index and international socio-political institutions, international accounting standards, and international financial institutions. We find that legal form (a control variable) is significantly related to the overall disclosure index. Implications/limitations - The current disclosure practices of the Egyptian listed non-financial companies may benefit individual investors when planning their investment choices in Egypt. Identifying variables affecting disclosure levels and shedding light upon the difference between state-owned business enterprises and private sector companies regarding disclosure practices might help regulators in specifying ways to enhance disclosures and transparency in the ESE. Moreover, this study may help accounting researchers as a guide in studying other markets, which may contribute to the accounting literature in the emerging capital markets.