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Ownership concentration and Covid-19 disclosure: the mediating role of corporate leverage

Khaldoon Albitar (Faculty of Business and Law, University of Portsmouth, Portsmouth, UK)
Mahmoud Elmarzouky (Kingston Business School, Kingston University, London, UK)
Khaled Hussainey (Faculty of Business and Law, University of Portsmouth, Portsmouth, UK)

International Journal of Accounting & Information Management

ISSN: 1834-7649

Article publication date: 18 March 2022

Issue publication date: 14 June 2022

517

Abstract

Purpose

This paper aims to examine the impact of ownership concentration on Covid-19 disclosure in the narrative sections of corporate annual reports. It also explores the mediating role of corporate leverage on the ownership concentration–Covid-19 disclosure relationship.

Design/methodology/approach

This paper uses automated textual analysis to measure Covid-19 disclosure in annual reports. It also applies different regression models to test the research hypotheses and to address the endogeneity problem. It uses univariate and multivariate analyses through correlations and ordinary least squares.

Findings

The analysis shows that ownership concentration has a negative impact on Covid-19 disclosure. It also shows that corporate leverage negatively affects Covid-19 disclosure, and it has a partial mediating effect on the ownership concentration–Covid-19 disclosure relationship.

Practical implications

The results offer important practical implications for the government, management, shareholders and policymakers. For example, corporate managers are encouraged to consider small shareholders’ interests and provide a sufficient level of Covid-19 disclosure to avoid violating their rights. Also, the government may consider forming a mechanism for balancing the ownership structure to protect small investors and weaken large shareholders’ tunnelling behaviours.

Originality/value

This paper offers two important contributions to governance and disclosure literature. First, it provides new empirical evidence on the relationship between ownership concentration and Covid-19 disclosure. Second, it provides new evidence on the mediating role of the leverage ratio on the ownership concentration–Covid-19 disclosure relationship.

Keywords

Citation

Albitar, K., Elmarzouky, M. and Hussainey, K. (2022), "Ownership concentration and Covid-19 disclosure: the mediating role of corporate leverage", International Journal of Accounting & Information Management, Vol. 30 No. 3, pp. 339-351. https://doi.org/10.1108/IJAIM-10-2021-0202

Publisher

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Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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