Corporate Governance Practices and Tax Disclosure among Firms Listed at the Nairobi Securities Exchange, Kenya


  • Caroline Kigo Moi University
  • Patrick Limo Moi University
  • David Muraga Moi University


Tax disclosure has been associated with numerous benefits including putting pressure on regulators to develop the tax system and also propels organizations to oppose aggressive tax decrease strategies. The aim of this study was to establish the relationship between corporate governance practices and disclosure of corporate tax among companies listed on the Nairobi Securities Exchange (NSE), Kenya. The study employed an explanatory research design. The target population was 65 companies listed at the NSE, but only 56 firms were surveyed. Research variables data was derived from the companies annual financial statements. Panel data was collected from 2014 to 2018 for all 56 companies making 280 observations. The results revealed that ownership structure, board size and board independence had a positive and significant relationship with corporate tax disclosure among firms listed at NSE, Kenya. The study concluded that listed firms with directors who have a higher stock holding have high level of financial disclosure. In addition, board size has an impact on corporate tax disclosure because boards that are larger in size have diverse expertise to help make better decisions, and are harder for their powerful CEOs to dominate. Larger boards enable a firm to include more diverse board members bringing different areas of technical expertise. In addition, the study concluded that the higher proportion of independent non-executive and executive directors increased board effectiveness in monitoring the management of the firms in their decision making thereby increasing voluntary disclosures of information. The study recommended that the management of firms listed in NSE should ensure that the ownership structure is well constituted so that this does not limit corporate tax disclosure. It suggested that the firms management should ensure that there is an appropriate board size to ensure there is smooth coordination within the board. It also recommended that listed firms regulators ensure that there is board independence whereby majority of directors should be non-executive directors as this allows them to make appropriate and non-partisan decisions including matters regarding tax disclosure. 

Keywords:  Corporate governance practices, tax disclosure, Nairobi securities exchange

Author Biographies

Caroline Kigo, Moi University

Moi University

Patrick Limo, Moi University

Moi University

David Muraga, Moi University

Moi University


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How to Cite

Kigo, C., Limo, P., & Muraga, D. (2020). Corporate Governance Practices and Tax Disclosure among Firms Listed at the Nairobi Securities Exchange, Kenya. Journal of Finance and Accounting, 4(3), 61–72. Retrieved from