Strategy disclosure in annual reports: an analysis of cultural dimensions, legal systems and corporate governance in four countries

Authors

  • Marcelo Sanches Pagliarussi Universidade Fundação Instituto Capixaba de Pesquisas em Contabilidade, Economia e Finanças Business School
  • Giuliana Bronzoni Liberato Universidade Fundação Instituto Capixaba de Pesquisas em Contabilidade, Economia e Finanças Business School

Keywords:

Disclosure, Strategy, Legal System, Corporative Governance, Cultural Dimensions.

Abstract

In this work we searched for an explanation for the differences observed in the level of strategic disclosure observed in the annual reports of a sample of companies from the United States, the United Kingdom, France and Brazil. We brought three theoretical elements to explain disclosure variations  within the sample: cultural dimensions, legal system and corporate governance issues. We based our analysis on concepts brought by three theories: cultural dimensions, legal systems and corporate governance. We built a prediction matrix based on the theoretical assumptions and we performed a thematic content analysis in each company’s annual report in order to assess its strategy disclosure. The hypothesis was tested through linear regression analysis and nonparametric tests of equality of means. The results partially supported the theoretical hypothesis presented, which states that there is a significant influence from the cultural variables, the legal system and from the corporate governance issues on the strategy disclosure observed in the annual reports. The companies in common law countries, represented by the United States and the United Kingdom, disclosed more about their strategies than companies in civil law countries, represented in the sample by France and Brazil. This work contributes with the literature on strategy disclosure emphasizing that the legal system does influence on the quantity of strategic information revealed by listed companies. However, the manual content analysis used here imposes limitations regarding sample size.

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Author Biographies

Marcelo Sanches Pagliarussi, Universidade Fundação Instituto Capixaba de Pesquisas em Contabilidade, Economia e Finanças Business School

Doutor em Ciência e Engenharia de Materiais pelo Programa de Pós-Graduação em Ciência e Engenharia de Materiais da Universidade Federal de São Carlos

Professor do Departamento de Administração da Universidade Fundação Instituto Capixaba de Pesquisas em Contabilidade, Economia e Finanças Business School

Giuliana Bronzoni Liberato, Universidade Fundação Instituto Capixaba de Pesquisas em Contabilidade, Economia e Finanças Business School

Mestre em Ciências Contábeis pelo Programa de Pós-Graduação em Ciências Contábeis da Universidade Fundação Instituto Capixaba de Pesquisas em Contabilidade, Economia e Finanças Business School

Pesquisadora do Departamento de Ciências Contábeis da Universidade Fundação Instituto Capixaba de Pesquisas em Contabilidade, Economia e Finanças Business School

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Published

2011-03-09

Issue

Vol. 12 No. 4 (2011)

Section

Resources and Entrepreneurial Development

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