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The purpose of this paper is to investigate the relationship between board characteristics and real performance among state-owned enterprises (SOEs) in Malaysia in a longitudinal period following the introduction of transformation policy.

The study deviates from prior research in utilising a real performance measure rather than traditional measures of performance. The authors adopt the quantile regression approach to examine the impact of board characteristics on real performance in a comparison using ordinary least squares.

The results of quantile regression reveal that the impact of board mechanisms on real performance was not as expected. Specifically, board size and duality had a bearing on real performance. Board independence also is considered as influential factor through the time. However, such effects were not homogenous across different quantiles. The dummy year variable to compare the period pre- and post-transformation policy reveals that the dummy year is not significant, indicating that performance post-transformation is indifferent compared to the pre-transformation policy period.

It is important for government to reconsider the policies embedded in the transformation policy. This study provides insights on the enhancement of board effectiveness and new developments regarding GLCs.

This is an early to attempt to measure real performance and its link to board characteristics in SOEs post-transformation policy.

The purpose of this paper is to examine the relationship between IC disclosure and the corporate market value (CMV) of listed firms on the main board of Nigeria Stock Exchange and to test the moderating effect of religious and ethnic composition of board members on the relationship.

This study applies the signaling and upper echelons theories in formulating four hypotheses that guide the results analysis. By employing a two-step dynamic system generalized method of moments and controlling for the possible endogeneity effect on the parameters estimated for a sample of 91 listed firms on main board of Nigeria Stock Exchange, this study investigates the association of IC disclosure with CMV, namely, cost of capital and market capitalization, and the moderating role of religious and ethnic composition on such association using data over the 2010 to 2014 financial years.

The results show a significant positive relationship between overall IC disclosure and market capitalization and a negative impact on cost of capital, which are in line with the hypothesized propositions. The moderating effect of board diversity is also confirmed. This study contributes to recent evidence concerning the value relevance of IC information to investors and other interested stakeholders and the established moderating role of board diversity in IC disclosure-related studies.

The regulators may consider development of standards on board composition about religious and ethnic composition in order to curb the domination from same group in the board room. Those charged with governance should be concerned with the disclosure of IC information in the financial statements as it has value relevance to the investors, in line with signaling theory.

The ethnic and religious composition of board members is a significant factor within the board room and needs to be given adequate consideration.

This study is the first to consider IC disclosure across whole sectors in the Nigerian economy and looks upon ethnicity and religious affiliation of boards as moderating variables. The study controls for heteroscedasticity and endogeneity issues by adopting two-step dynamic system generalized method of moments.

The purpose of this paper is to examine the value relevance of intellectual capital (IC) by analysing the relationship between IC efficiency (ICE) and corporate book value of listed firms on main board of Nigeria Stock Exchange.

This study applies the resource-based theory in formulating two hypotheses that guide the results analysis. By employing a two-step dynamic system generalised method of moments (GMMs), and controlling for the possible endogeneity effect on the parameters estimated, for a sample of 91 listed firms on main board of Nigeria Stock Exchange, this study investigates the association of ICE and corporate book value, namely, cash flow from operation and economic value added (EVA), using data over the 2010 to 2014 financial years.

The results show a significant positive relationship between overall ICE and corporate book value (cash flow from operation and EVA). This study contributes to recent evidence concerning the value relevance of IC information to investors and other interested stakeholders.

The generalisation of the results to smaller firms, in the alternative securities market, may be inappropriate as study sampled listed firms on the main board of Nigerian Stock Exchange.

Those charged with governance should be concerned with the investment and management of IC as it enhances the economic value and operating cash flow in line with the resource-based theory.

This study is first to consider the ICE study across all sectors in the Nigerian economy using modified Pulic value added intellectual capital. The study controls for heteroscedasticity and endogeneity issues by adoption of two-step dynamic system GMMs.

As the major shareholder, in 2004, the Malaysian Government embarked on the transformation initiative of the Government Linked Companies (GLCs). One of the main initiatives was to enhance board effectiveness through its Green Book. Soon after, the progress performance review revealed that the GLCs reported improved earnings. Such drastic performance turnarounds triggered the question as to whether earnings quality is at stake. The purpose of this paper is to examine the impact of the tightening of corporate governance mechanisms on earnings management (EM) activities of the GLCs.

The earnings data for two periods (pre‐ and post‐transformation) were collected and tested to determine whether the GLCs experienced any improvement of board monitoring role in curbing EM activities in the post‐transformation period.

The main findings show that there is an increase of EM activities in the post‐transformation policy. Furthermore, the study also reveals that none of the corporate governance mechanisms has much impact on curbing activities, except for board meetings and leadership structure in the post‐transformation period. The board meetings and separation of chairman and chief executive officers in the companies were shown to only have a negative impact on EM activities in the post‐transformation period. Although the study has shown a positive preliminary impact from tightening the corporate governance of the GLCs, weak earnings quality might undermine the efforts to sustain such a transformation.

The paper contributes to the limited body of literature concerning the impact of corporate governance on earnings management by examining such impact using Government Linked Companies in Malaysia after introducing the transformation programme.

This paper aims to examine the effects of intellectual capital (IC) disclosure in the annual reports of listed companies in Bursa Malaysia (BM) on their market capitalization (MCAP).

The paper uses secondary data for listed companies on BM for the years 2002 and 2006. A disclosure index was used to measure the extent of IC information disclosed in the annual reports. The MCAP data were obtained from the Bloomberg database. The data were analyzed using correlation and regression analyses.

The paper finds that the extent of IC disclosure by Malaysian‐listed companies has a positive significant effect on their MCAP. In addition, the paper found that there is significant positive impact of the control variables (i.e. book value, net profit, firm size and leverage) on the MCAP.

Although the paper was focused on the IC information and MCAP data for two years (i.e. 2002 and 2006), it provides empirical evidence that IC disclosure does affect the MCAP of companies. Hence, it means that the IC information is picked up by the market. Future research may incorporate more control variables and years.

The findings provide empirical evidence that IC information disclosed by the Malaysian‐listed companies positively affects their MCAP. These findings can be considered to be useful for these companies and work as a signal towards the need for more IC disclosure. In addition, the findings could be useful for the regulatory bodies, e.g. the Malaysian Accounting Standards Board and BM, perhaps to develop guidelines on IC disclosure to enhance transparency and increase confidence in the capital market.

The paper is considered the first empirical study to examine the effects of IC disclosure in the annual reports of Malaysian‐listed companies on their MCAP.

PurposeAuditor independence is fundamental to public confidence in financial reporting and the auditing profession. The study aims to provide further understanding of the factors influencing auditor independence from the perspective of commercial loan officers. Loan officers formed the sample as they are relatively sophisticated financial statement users who would understand the importance of audit report and the issues related to auditor independence.Design/methodology/approachThe study examines the perceptions of commercial loan officers in Malaysian‐owned commercial banks and a total of 86 officers responded to the self‐administered questionnaire.FindingsResults indicate that smaller audit firms, audit firms operating in a higher level of competitive environments, audit firms serving a given client over a longer duration, larger size of audit fees, audit firms providing managerial advisory services, and, the non‐existence of an audit committee, are perceived as having a higher risk of losing independence. Audit firm size appears to be the most important factor that affects the auditor independence, followed by tenure, competition, audit committee, audit firms providing managerial advisory services and size of audit fee.Originality/valueThe paper provides important insights into the factors affecting auditor independence and contributes towards better understanding on the ways to improve the confidence in financial reporting and credibility of the auditing profession.

The objective of this paper is to examine the determinants (i.e. firm size, profitability, leverage, type of audit firm and industry type) of intellectual capital (IC) disclosure in the annual reports of Malaysian listed companies.

The data were collected from the 2006 annual reports of the selected listed companies; and analyzed using descriptive statistics, t‐test, correlation and regression analyses.

The paper found that firm size, profitability, industry type are determinants of IC disclosure (ICD) in the annual reports of Malaysian listed companies, while leverage and type of audit firm did not statistically influence ICD.

The paper only used data from the 2006 annual reports. However, the findings have highlighted the importance of ICD determinants based on data from an emerging economy (i.e. Malaysian economy).

The paper provides empirical evidence on the current practices and determinants of ICD in the annual reports of the Malaysian listed companies. This evidence would help in understanding and determining factors that influence the extent of ICD. Subsequently, it could assist in enhancing ICD in the annual reports.

The paper contributes by extending the limited ICD literature in Malaysia. Furthermore, the paper has tested more determinants, deemed to influence ICD, compared to prior Malaysian studies. In addition, the paper used a larger sample size with a wider industry coverage compared to previous Malaysian literature.

The paper aims to examine the determinants of corporate social responsibility (CSR) disclosures in the annual reports of Malaysian public listed companies (PLCs). In 2006, Bursa Malaysia Berhad (BMB) launched its CSR Framework (effective in 2007) which is supposed to guide the Malaysian PLCs’ CSR disclosures. It is believed that this CSR framework may influence CSR disclosures to be more systematic, yet there is no evidence whether this framework influences the extent and quality of CSR disclosures. Thus, this study examines this area of research. The study also tests the influence of award on CSR disclosures.

CSR disclosure checklist was developed to analyse the extent and quality of CSR information disclosures in the year 2008 annual reports of the Malaysian PLCs.

Malaysian PLCs disclose more CSR information related to community and environment than workplace and marketplace CSR themes. On the other hand, the quality of disclosure practices was minimal when it is compared to the extent of disclosure practices. Finally, the study also found that the award’s variable has a significant positive relationship with both the extent and quality of CSR disclosure practices of the Malaysian PLCs.

The recently developed BMB’s CSR framework seems to have impact on the level and systematic CSR reporting practices of Malaysian PLCs. However, the quality of CSR disclosures is considered minimal.

The results of the study bring some practical implications to the regulators, particularly Bursa Malaysia. First, it is good to observe that most companies have practiced specific disclosure in a separate statement with regard to CSR. However, the format of presentation and the extent of disclosure vary among the firms. Second, further guidelines need to be developed to provide a clearer framework of disclosure for CSR information. At the moment, Bursa Malaysia only listed down general principles of CSR themes. In addition, the regulators should also look into the evolving issues in CSR, such as the issue of climate change reporting. For example, the Climate Disclosure Standards Board has issued a voluntary Climate Change Reporting Framework.

This study examined both the traditional (i.e. firm size and profitability) and non-traditional (i.e. award) factors influencing management’s decision to disclose CSR information in the annual reports of the Malaysian PLCs. Furthermore, the study reported how Malaysian PLCs comply with the recently implemented CSR framework issued by BMB.

The purpose of this study is to ascertain the control role of independent non-executive directors (INEDs) in Malaysian public listed companies (PLCs), as prescribed in the Malaysian Code on Corporate Governance (MCCG).The MCCG (2000) requires substantive involvement of INEDs on the audit, nomination and remuneration board sub-committees. The study also examines the effectiveness of INEDs in discharging their monitoring roles in these sub-committees.

A qualitative research design consisting of a series of interviews with board members of Malaysian-owned PLCs on the board of Bursa Malaysia was used.

Interviews with 27 company directors reveal that, due to their independence, INEDs are crucial in safeguarding the interests of smaller investors if situations arise in which shareholders’ interests may be threatened. The interviews also disclose that the audit committee possesses the most authority among the sub-committees, as it derives its power not only from the Listing Requirements but also from statute, as well as being involved in areas of the company not traditionally associated with the committee. The study also reveals the differences in opinion between executive directors and INEDs with regard to the extent of INEDs’ effectiveness.

This research utilises interviews. Generalisation may be an issue when interviews are used as the method of inquiry. In addition, the sample is not random, as access to many directors is dependent on recommendations. In addition, the respondents have been consciously selected to cover various board positions, including independent and non-independent directors.

The findings from this research suggest that INEDs are able to discharge their responsibilities in overseeing the conduct of executives and protecting the interests of investors. In addition, the interviews disclose that the effectiveness of INEDs depends on how non-executive directors view INEDs being on the board. Rather than focusing solely on their control role, INEDS are expected to have a more proactive and progressive role in ensuring sustainable growth and the expansion of the business entity.

There are limited studies using qualitative research design in investigating the effectiveness of INEDs in the control role of the board in developing countries. Prior studies were predominantly based upon the experience of Western economies.

This study attempts to apply legitimacy theory to determine if it explains the extent and nature of environmental disclosures made, and the reasons for the disclosure in the context of Malaysian industrial products and construction companies. The study adopts a dual methodology of content analyses of annual reports and a questionnaire survey. Findings show some limited support for legitimacy theory in explaining the nature of disclosure, as well as the reasons for the disclosure. Extent of environmental disclosures is, however, very low. Further research is suggested in other industry sectors to examine if the results are consistent across industry sectors.