Determinants of Corporate Risk Disclosure in Annual Reports of UK Companies

Ramakrishnappa, Paramesh (2009) Determinants of Corporate Risk Disclosure in Annual Reports of UK Companies. [Dissertation (University of Nottingham only)] (Unpublished)

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The dissertation was focused on understanding the determinants of corporate risk disclosure in annual reports of UK companies. There were three key objectives to the research: (1) evaluate the determinants of narrative disclosure concerning risk management and internal control in the UK companies that is valuable to policy makers, (2) explain how companies disclose their financial information to various stakeholders – users, employees, government and clients among others, and (3) evaluate the knowledge resulting from the research and identify hints for future regulation and provide an impetus for more empirical research.

The dissertation pursued a qualitative research based on secondary research. The summary findings and conclusions include the following:

• Understanding motivations of firms in pursuing greater corporate risk disclosure. Firms have different motivations in providing increased disclosure and these include: (1) increased valuation, (2) better pricing of inputs, and (3) target specific investors.

• Identifying the possible factors that drive the decisions of firms and which could be similar to own firms. Sector-specific rationale are important and, in the case of financial services firms, providing information on the illiquid assets and the amount written down are important particularly in the near-term where investors are searching for information.

• Determine the best course of action related to corporate risk disclosures. Each firm will need to decide on the best course of action but certainly, some of the key principles in terms of disclosures, particularly for corporate risk, include the following: (1) provide increased transparency to the corporate risk management and internal controls processes and systems to provide investors and other stakeholders comfort and understanding, (2) ensure enough relevant information is provided to prevent any market rumours or speculation affect the business, and (3) ensure that the right individuals are in place and have the capability and skills to effectively perform the tasks.

The dissertation showed that financial services firms provided greater disclosure of information in their annual reports versus retail sector firms.

Item Type: Dissertation (University of Nottingham only)
Depositing User: EP, Services
Date Deposited: 03 Feb 2010 12:36
Last Modified: 16 Feb 2018 12:37

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