Developing Enterprise Risk Management Disclosure Index using Factor Analysis

Abstract

This study aims to explore the Enterprise Risk Management (ERM) disclosure by publicly listed firms in Malaysia. This study analyses a sample of 832 non-financial publicly listed firms in Malaysia between 2016-2019. This study used a more comprehensive index by embedding COSO-integrated ERM framework 2017 and ISO 31000. The data is analyzed using factor analysis to develop the ERM disclosure index. The results show that ERM disclosure consists of 4 main components: governance and culture, performance, objective setting, and reporting approach. Meanwhile, the level of ERM disclosure is still at a moderate level.