The role of corporate governance in increasing risk reporting: A comparative study of emerging markets companies

Abstract

The purpose of this study is to explore the level of presentation of risk information reports called risk reporting (RR) in the annual reports of Indonesian and Malaysian non-financial companies. In addition, this study aims to empirically examine the role of corporate governance (CG) in presenting RR and compare its role in the two countries. The method used in this study is content analysis with 113 samples of Indonesian companies and 70 Malaysian companies. The results showed that the board of directors (BD) of Indonesian companies represented by the board of commissioners and independent commissioners and the boards of Malaysian companies represented by the board of directors and independent directors had the same role, in line with the research of Yubiharto and Rudianti (2021), and Yermack (1996). However, in Indonesia, it plays a role in increasing the number of RRs, while in Malaysia, it is the opposite. The results of this research are also preliminary evidence that there is a difference in the role of the CG structure, which is a two-tier and one-tier system.