Corporate Governance Mechanisms and Extent of Disclosure: Evidence from Companies in Nepal

Corporate Governance Mechanisms and Extent of Disclosure:
Evidence from Companies in Nepal
Bikash Gajurel, Dinesh Pyatha, Ganesh Joshi, and Jyoti Kafle
Uniglobe College
Baneshwor, Kathmandu
Abstract
The main purpose of the study is to investigate whether the existence of corporate governance mechanisms is effective in increasing the extent of disclosure amongst public listed companies in Nepal. Dscore index is prepared to collect data for the study. Regression analysis is used to determine the association between corporate governance mechanism and extent of disclosure level in Nepalese companies. This study reveals that the extent of corporate governance disclosure in larger companies is higher than small companies.

Introduction
The corporate governance is the process by which organizations are directed, controlled and held to account. This implies that corporate governance encompasses the authority, accountability, stewardship, leadership, direction and control exercised in the process of managing organizations. Since this definition recognizes the need for checks and balances in the process of managing organizations, it can be considered to be more comprehensive (Gregory, 2000). Moreover, it is similar to the definitions provided by the Audit Commission (2009) and CIPFA/SOLACE (Chartered Institute of Public Finance and Accountancy and the Society of Local Authority Chief Executives 2007) which emphasize the core aspects of accountability and control in the governance of organizations. Corporate Governance (CG) structure specifies the distribution of rights and responsibilities among different participants in the corporation such as, the board, managers, shareholders and stakeholders, and spells out the rules and procedures for making decisions on corporate affairs. It is the allocation of ownership, capital structure, managerial incentive schemes, takeovers, board of directors, pressure from institutional investors, product market competition, labor

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