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Further evidence on web-based corporate disclosures in developed versus developing countries: A comparative analysis of nature and determinants in Egypt and the United Kingdom

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Abstract

This study aims to provide further evidence on the nature of Web-based corporate disclosures (WCD) by Egyptian listed firms. Moreover, the study aims to assess the developments in WCD by Egyptian listed firms in light of the practices adopted by the top UK firms (FTSE 100). It also aims to provide evidence on the determinants of WCD. The findings from the current study are in line with previous research in an Egyptian context covering the period 2006–2008, which indicates that no developments in WCD practices are observed between the periods covered by the previous studies and the very recent period covered in the current study 2 years later. The findings from the comparative analysis revealed high divergence in WCD practices between Egypt, as a developing country with an emerging capital market, and the United Kingdom, as a developed country with a full-grown capital market. WCD in Egypt is lagging very far behind the developed and technologically advanced countries such as the United Kingdom. The findings provide regulators with useful information about the level of using the Internet for disseminating corporate information by listed firms in Egypt and address the need to mandate accounting standards for high-quality corporate disclosure on the Internet. In this context, Saudagaran and Diga (1997) have argued that in emerging capital markets, where the level of information asymmetry appears to be greater than in developed markets, investors may be discouraged by perceptions of unfair trading. It is essential to have effective enforcement, and regulatory processes, as the mechanisms for monitoring and enforcing disclosure in developing countries (that is, imposing penalties on non-violators) is a key player in promoting higher compliance levels by companies. The regression results revealed that managerial ownership, board independence, CEO-Chair duality, firm size and leverage are significant in driving the WCD level in Egypt, and hence these findings offer insights to the Egyptian policymakers and regulators on how to improve WCD by listed firms in Egypt. Finally, we found that factors explaining voluntary adoption of WCD in Egypt, as an example of a developing country, are different from those reported in the United Kingdom by Abd Elsalam et al (2007), as an example of a developed country, and this supports the proposition that WCD choices by firms in the different countries are responsive to specific attributes of their environment, and that there is a need to build models that include country-level factors (that is, culture, internet penetration, legal system, political system, and so on) to better explain the level of WCD.

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Authors and Affiliations

  1. Department of Accounting, School of Business, The American University in Cairo, Fifth settlement, New Cairo, Room 2058 – BEC Building, Egypt

    Khaled Samaha

Authors
  1. Khaled Samaha
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  2. Sara Abdallah
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Correspondence to Khaled Samaha.

Additional information

2obtained her Masters degree in Accounting from the Faculty of Commerce – Cairo University. Currently, she is working as a Lecturer of Accounting in the British University in Egypt (BUE). She also works as a Research Assistant at the American University in Cairo (AUC). She contributed to a recent research on corporate governance structures and mandatory IASs disclosure by companies listed on the Egyptian Stock Exchange (EGX) that was funded by the Capital Market Authority and the American University in Cairo.

Appendices

Appendix A

Table A1

Table A1 EGX 100 (classified by industry sector) website addresses
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Appendix B

Table B1

Table B1 FTSE 100 website addresses
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Appendix C

Table C1

Table C1 Web-based disclosure checklist attributes frequency: Egypt versus United Kingdom
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Appendix D

Table D1

Table D1 Summary of the findings: Current study versus prior Egyptian WCD research versuss Abd Elsalam et al (2007)in the United Kingdom
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Samaha, K., Abdallah, S. Further evidence on web-based corporate disclosures in developed versus developing countries: A comparative analysis of nature and determinants in Egypt and the United Kingdom. Int J Discl Gov 9, 148–180 (2012). https://doi.org/10.1057/jdg.2011.17

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  • DOI: https://doi.org/10.1057/jdg.2011.17

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