Effect of enterprise risk adoption and risk governance structure on voluntary disclosure of listed manufacturing firms in Nigeria

Abstract

This study empirically investigates the effect of Enterprise Risk Management (ERM) Adoption and Risk Governance Structure (RGS) on the level of Voluntary Disclosure among listed manufacturing firms in Nigeria. The research utilizes a positivist, ex-post facto approach with a sample of 410 firm-year observations, employing a Random Effects panel regression model to test the effect of the two distinct Risk Management proxies on Voluntary Disclosure. The independent variables are Enterprise Risk Management Adoption and Risk Governance Structure, while the dependent variable is Voluntary Disclosure measured using a comprehensive disclosure index. The findings show that both Enterprise Risk Management Adoption and Risk Governance Structure have a statistically significant and positive effect on the extent of voluntary disclosure. The study concludes that investments in sophisticated ERM frameworks and effective RGS mechanisms are crucial for listed manufacturing firms seeking to mitigate information asymmetry and improve market valuation through enhanced voluntary disclosure. The recommendation is for management and regulatory bodies to focus resources on strengthening the maturity of ERM implementation and the structural integrity of risk governance to meet global standards for corporate transparency and resilience.