To read this content please select one of the options below:

Risk disclosure behaviour: evidence from the UK extractive industry

Stuart Mcchlery (Glasgow Caledonian University, Glasgow, UK)
Khaled Hussainey (University of Portsmouth, Portsmouth, UK)

Journal of Applied Accounting Research

ISSN: 0967-5426

Article publication date: 9 February 2021

Issue publication date: 7 May 2021




This paper contributes to risk management research with reference to disclosure of risk specific information within the oil and gas industry. This paper provides empirical evidence regarding voluntary and mandatory disclosure behaviour from both a quantitative and qualitative perspective.


A longitudinal empirical study examines probabilistic reserve quantum reporting of UK companies, over a time-period spanning voluntary and mandatory disclosure. The researchers analyse disclosure behaviour under voluntary and mandatory time spans using a logistical regression approach to measure determinants of risk reporting. Form of regulation is considered as the fundamental driver for disclosure whilst controlling for other relevant variables. Implications for developing international regulation are presented with suggestions for further research.


Mandatory reporting is not seen as a significant influence to disclosure. Degree of risk, quality of audit firms, level of stock exchange and organisational visibility each impact on disclosure. The findings indicate that a mandatory disclosure approach is ineffective, partially explained by mimetic and normative forces and a balancing of agency-related costs and benefits. There is an inverse relationship between level of risk and risk reporting.

Research limitations/implications

Generalisation of the findings is limited due to the specific context of the extractive industry.

Practical implications

The paper seeks to inform the International Accounting Standards Board's (IASB) on-going consideration of risk reporting and also its extractive industries deliberations.


The paper provides original insight into the area of risk management with particular focus on risk specificity and quantitative metrics for risk profiling not previously tested. The paper introduces risk profiling as a variable in risk disclosure.



Mcchlery, S. and Hussainey, K. (2021), "Risk disclosure behaviour: evidence from the UK extractive industry", Journal of Applied Accounting Research, Vol. 22 No. 3, pp. 484-506.



Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

Related articles