Determinants of the extent of voluntary disclosure in the annual reports of the Moroccan banks

Abstract

Many studies have been conducted on the voluntary disclosure practices. Researchers still continue to come up with various conclusions with regard to the determinants of voluntary disclosure.

The main objective of this study is to investigate the determinants of the level of voluntary disclosure of banking companies listed on the Casablanca Stock Exchange. In particular, we examine associations between the internal and external mechanisms of governance and the extent of voluntary disclosure. Analysis of annual reports of the Moroccan listed banks during the period 2005-2015, shows that the foreign ownership has the most significant positive impact on the extent of voluntary disclosure. The results also show that larger banks provide greater level of voluntary disclosure. However, contrary to Agency theory predictions, the CEO duality has a significant positive impact on the extent of voluntary disclosure of Moroccan listed banks. Other mechanisms of governance like board size, board independence, block ownership and government ownership are not significantly associated with voluntary disclosure.

Keywords: Voluntary disclosure, banking companies, internal and external mechanisms of governance, annual reports, Agency theory predictions.