Variable operationalisation and source
| Variable | Operationalisation | Source of data |
|---|---|---|
| Dependent variable | ||
| Annual report readability (RREAD-LNT) | Natural log of number of pages multiplied by −1 | Annual report |
| Annual report readability (RREAD-SZ) | Natural log of file size in megabytes multiplied by −1 | Annual report |
| Explanatory variable | ||
| ESG disclosure | Environmental disclosure was measured using five indicators, namely GhG emissions, energy usage, energy mix, water usage and environmental operations, each coded as 1 if disclosed in a given year and 0 otherwise. Social disclosure covered seven areas, including training and education, CEO and gender pay ratios, employee turnover, gender diversity, non-discrimination and health and safety, with a score of 1 assigned when any item appeared in the annual report, otherwise 0. Governance reporting was evaluated using nine categories such as board diversity and independence, ethics and anti-corruption, data privacy, disclosure practices, external assurance, regulatory compliance, stakeholder engagement and broader governance practices, each coded 1 if disclosed, otherwise 0. The annual ESG score was computed as the average of all dummy values, yielding a range from 0 to 1, where higher values reflect more extensive ESG disclosure | Annual report |
| Moderating variable – audit committee characteristics | ||
| Audit committee gender diversity | Number of female directors on audit committee | Annual report |
| Audit committee meetings | Number of audit committee meetings per annum | Annual report |
| Audit committee size | Number of directors on the audit committee per annum | Annual report |
| Control variables | ||
| Board size | Number of directors on board per annum | Annual report |
| Board independence | Number of nonexecutive directors on board | Annual report |
| Financial leverage | Total liabilities divided by total assets | Annual report |
| Firm size | Natural log of total assets | Annual report |
| ROA | Profit before tax divided by total assets | Annual report |
| Loss dummy | Binary variable that is assigned 1 if the firm for a particular year made a loss otherwise 0 | Annual report |
| Firm age | Number of years since the firm was incorporated | Annual report |
| Variable | Operationalisation | Source of data |
|---|---|---|
| Annual report readability (RREAD-LNT) | Natural log of number of pages multiplied by −1 | Annual report |
| Annual report readability (RREAD-SZ) | Natural log of file size in megabytes multiplied by −1 | Annual report |
| ESG disclosure | Environmental disclosure was measured using five indicators, namely GhG emissions, energy usage, energy mix, water usage and environmental operations, each coded as 1 if disclosed in a given year and 0 otherwise. Social disclosure covered seven areas, including training and education, CEO and gender pay ratios, employee turnover, gender diversity, non-discrimination and health and safety, with a score of 1 assigned when any item appeared in the annual report, otherwise 0. Governance reporting was evaluated using nine categories such as board diversity and independence, ethics and anti-corruption, data privacy, disclosure practices, external assurance, regulatory compliance, stakeholder engagement and broader governance practices, each coded 1 if disclosed, otherwise 0. The annual ESG score was computed as the average of all dummy values, yielding a range from 0 to 1, where higher values reflect more extensive ESG disclosure | Annual report |
| Audit committee gender diversity | Number of female directors on audit committee | Annual report |
| Audit committee meetings | Number of audit committee meetings per annum | Annual report |
| Audit committee size | Number of directors on the audit committee per annum | Annual report |
| Board size | Number of directors on board per annum | Annual report |
| Board independence | Number of nonexecutive directors on board | Annual report |
| Financial leverage | Total liabilities divided by total assets | Annual report |
| Firm size | Natural log of total assets | Annual report |
| ROA | Profit before tax divided by total assets | Annual report |
| Loss dummy | Binary variable that is assigned 1 if the firm for a particular year made a loss otherwise 0 | Annual report |
| Firm age | Number of years since the firm was incorporated | Annual report |
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