The increased volatility and decline in firm value has been observed for companies listed in the Nairobi Securities exchange, Kenya as evidenced by substantial variations between market-to-book values. Company disclosures in integrated reports have long been linked with firm value. However, integration of non-financial information disclosures with financial information in a single report and its worth to the company and its distinctive stakeholders has not been accorded a proper assessment in the African context. While, preceding studies in other settings have shown mixed results, emphasis has been on establishing the total effects. This comparative study was intended to determine the effect of
| Published in | International Journal of Accounting, Finance and Risk Management (Volume 9, Issue 3) |
| DOI | 10.11648/j.ijafrm.20240903.12 |
| Page(s) | 79-103 |
| Creative Commons |
This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited. |
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Copyright © The Author(s), 2024. Published by Science Publishing Group |
Integrated Reporting, Social and Relationship Capital, Corporate Disclosures, Business Model, Firm Value, Listed Firms
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APA Style
Bangara, S. N., Chesoli, J. W., Ngacho, C., Nyangau, A. (2024). Social and Relationship Capital Disclosure, Business Model and Firm Value: A Comparative Study of Listed Companies in Kenya and South Africa. International Journal of Accounting, Finance and Risk Management, 9(3), 79-103. https://doi.org/10.11648/j.ijafrm.20240903.12
ACS Style
Bangara, S. N.; Chesoli, J. W.; Ngacho, C.; Nyangau, A. Social and Relationship Capital Disclosure, Business Model and Firm Value: A Comparative Study of Listed Companies in Kenya and South Africa. Int. J. Account. Finance Risk Manag. 2024, 9(3), 79-103. doi: 10.11648/j.ijafrm.20240903.12
AMA Style
Bangara SN, Chesoli JW, Ngacho C, Nyangau A. Social and Relationship Capital Disclosure, Business Model and Firm Value: A Comparative Study of Listed Companies in Kenya and South Africa. Int J Account Finance Risk Manag. 2024;9(3):79-103. doi: 10.11648/j.ijafrm.20240903.12
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Download@article{10.11648/j.ijafrm.20240903.12,
author = {Samwel Ndaita Bangara and Joshua Wafula Chesoli and Christopher Ngacho and Andrew Nyangau},
title = {Social and Relationship Capital Disclosure, Business Model and Firm Value: A Comparative Study of Listed Companies in Kenya and South Africa
},
journal = {International Journal of Accounting, Finance and Risk Management},
volume = {9},
number = {3},
pages = {79-103},
doi = {10.11648/j.ijafrm.20240903.12},
url = {https://doi.org/10.11648/j.ijafrm.20240903.12},
eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijafrm.20240903.12},
abstract = {The increased volatility and decline in firm value has been observed for companies listed in the Nairobi Securities exchange, Kenya as evidenced by substantial variations between market-to-book values. Company disclosures in integrated reports have long been linked with firm value. However, integration of non-financial information disclosures with financial information in a single report and its worth to the company and its distinctive stakeholders has not been accorded a proper assessment in the African context. While, preceding studies in other settings have shown mixed results, emphasis has been on establishing the total effects. This comparative study was intended to determine the effect of capitals disclosure on value of listed companies in Kenya and South Africa, focusing on the role of the business model. Specifically, the role of the business model on the relationship between social and relationship capital disclosure and value of listed companies was examined in this research comparing Kenya and south Africa from 2018 to 2020. Positivist research philosophy was applied, while the research design encompassed both exploratory and confirmatory. The study was grounded on the Legitimacy theory. Firm value in this study was proxied by Tobin’s Q ratio, while, social and relationship capital was measured using an unweighted disclosure index. The study population contained 209 listed companies from which a sample of 137 was identified using purposeful sampling technique, comprising of 19 firms listed in the NSE, Kenya and 118 companies listed in the JSE, South Africa. Secondary data was collected from annual integrated reports and financial statements of the targeted firms. Preliminary analyses were conducted, such as descriptive statistics and correlation matrix. On the other hand, mediation effect was analysed by using stepwise regression method. The results depict that social and relationship capital disclosure has a statistically significant positive effect on firm values for both Kenya and South Africa. Further, business model mediates this relationship, with Kenyan listed firms manifesting inconsistent mediation while South African companies reported full/complete mediation. The study therefore recommends that social and relationship capital aspect of integrated reporting in Kenya should be made mandatory because this will improve shareholder understanding of financial statements and appropriate valuation of the firm.
},
year = {2024}
}
TY - JOUR T1 - Social and Relationship Capital Disclosure, Business Model and Firm Value: A Comparative Study of Listed Companies in Kenya and South Africa AU - Samwel Ndaita Bangara AU - Joshua Wafula Chesoli AU - Christopher Ngacho AU - Andrew Nyangau Y1 - 2024/09/06 PY - 2024 N1 - https://doi.org/10.11648/j.ijafrm.20240903.12 DO - 10.11648/j.ijafrm.20240903.12 T2 - International Journal of Accounting, Finance and Risk Management JF - International Journal of Accounting, Finance and Risk Management JO - International Journal of Accounting, Finance and Risk Management SP - 79 EP - 103 PB - Science Publishing Group SN - 2578-9376 UR - https://doi.org/10.11648/j.ijafrm.20240903.12 AB - The increased volatility and decline in firm value has been observed for companies listed in the Nairobi Securities exchange, Kenya as evidenced by substantial variations between market-to-book values. Company disclosures in integrated reports have long been linked with firm value. However, integration of non-financial information disclosures with financial information in a single report and its worth to the company and its distinctive stakeholders has not been accorded a proper assessment in the African context. While, preceding studies in other settings have shown mixed results, emphasis has been on establishing the total effects. This comparative study was intended to determine the effect of capitals disclosure on value of listed companies in Kenya and South Africa, focusing on the role of the business model. Specifically, the role of the business model on the relationship between social and relationship capital disclosure and value of listed companies was examined in this research comparing Kenya and south Africa from 2018 to 2020. Positivist research philosophy was applied, while the research design encompassed both exploratory and confirmatory. The study was grounded on the Legitimacy theory. Firm value in this study was proxied by Tobin’s Q ratio, while, social and relationship capital was measured using an unweighted disclosure index. The study population contained 209 listed companies from which a sample of 137 was identified using purposeful sampling technique, comprising of 19 firms listed in the NSE, Kenya and 118 companies listed in the JSE, South Africa. Secondary data was collected from annual integrated reports and financial statements of the targeted firms. Preliminary analyses were conducted, such as descriptive statistics and correlation matrix. On the other hand, mediation effect was analysed by using stepwise regression method. The results depict that social and relationship capital disclosure has a statistically significant positive effect on firm values for both Kenya and South Africa. Further, business model mediates this relationship, with Kenyan listed firms manifesting inconsistent mediation while South African companies reported full/complete mediation. The study therefore recommends that social and relationship capital aspect of integrated reporting in Kenya should be made mandatory because this will improve shareholder understanding of financial statements and appropriate valuation of the firm. VL - 9 IS - 3 ER -
Department of Accounting & Finance, Kisii University, Kisii, Kenya
Department of Accounting & Finance, Kisii University, Kisii, Kenya
Department of Accounting & Finance, Kisii University, Kisii, Kenya
Department of Accounting & Finance, Kisii University, Kisii, Kenya
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