Determinants Of Corporate Governance Disclosures Of Islamic Banks: Evidence From Sudan

Abstract

Islamic banks are exposed to relatively high risks due to their uniqueness and requirement of Shariah compliance. Therefore, Islamic banks are expected to have high governance disclosure levels to inform investors and other stakeholders. However, recent studies revealed that the disclosure of governance information is low in Islamic banks. Thus, this study examines two objectives. First, this study explores the extent of Corporate Governance Disclosure (CGD) in Islamic Sudanese banks. Second, the study aims to determine the factors that may explain the variations in CGD levels. In order to fulfill these objectives, a sample of fourteen banks was taken for the period from 2009 to 2013. A content Analysis and Ordinary Least Squares (OLS) regression model with pooled effects were used to achieve the study objectives. The findings of this study reveal low levels of CGD in Islamic banks of Sudan, which is only 39 percent on average. Islamic banks that have an established Audit Committee (AC), Internal Audit Function (IAF) and lower levels of governmental ownership were found to have higher CGD levels than their peers.