Influence of Corporate Transparency Disclosures on Financial Performance of Listed Companies in East Africa

Boniface Muriithi Wanjau, Willy Mwangi Muturi, Patrick Ngumi

Abstract


With the decline in the financial performance of listed companies in East Africa and the rising trend of corporate failure in both global and local perspective. Stakeholders are increasingly becoming more concerned of the financial performance of their firms. This study aimed to find out whether corporate transparency disclosure can be used to address the decline in financial performance and corporate failures. Therefore, the current study sought to examine the influence of corporate transparency disclosure on financial performance among companies listed in East Africa. Specifically, the study sought to examine the influence of financial transparency, risk transparency, social transparency and governance transparency on financial performance of companies listed in East Africa. The study adopted both descriptive and correlation design. Purposive sampling was used to select the 65 listed companies in Nairobi securities exchange in Kenya, 16 companies quoted in Uganda securities exchange, 7 companies which are quoted in Rwanda Securities Exchange as well as 24 companies listed in Daresalaam securities exchange from 2006 to 2015. Secondary data was collected through the use of document check index retrieved from annual audited financial statements. Regression diagnostic and panel data diagnostic tests were carried out. Results of the study revealed that there was a positive and significant relationship between financial, governance, risk, social transparency and financial performance of listed companies in East Africa.

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DOI: https://doi.org/10.5296/ajfa.v10i1.12492

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