Corporate Risk Disclosure: A Content Analysis of Swedish Interim Reports

Sammanfattning: The aim of this research is to examine the determinants of the level of corporate risk disclosure (CRD) in the interim reports of Swedish non-financial companies. A quantitative research approach is used, the sample data of which consist of 166 firms with 4,849 interim reports over a 10-year period. By utilizing the notion of risk and its definition, I have distinguished three categories of risk, namely risk as uncertainty, risk as threat and risk as opportunity. A systematic content analysis is conducted with the use of a software program, which is specifically designed for this purpose. The number of sentences that contain keywords related to the three risk categories is counted as the total CRD score, which is transformed to the disclosure index. I have examined the impact of firms’ characteristics and corporate governance mechanisms on the level of CRD based on agency theory. The ordinary least squares regression method with  control for fixed year effects is used to analyse the data, which show that firm size and audit committee have a positive relationship with the level of corporate risk disclosure. The result demonstrates also that there is a negative relationship between family ownership and the level of CRD, and an insignificant relationship between leverage and the level of CRD.