The Impact of Non-Financial Disclosure on Investor Decisions in Telecom Sector Companies in Iraq: An Applied Study on Zain Iraq and Asia cell
Abstract
This study aimed to analyze the impact of non-financial disclosure on investors' decisions in telecommunications sector companies in Iraq, through an applied study on Zain Iraq and Asiacell, as two of the most prominent companies operating in the Iraqi market. Non-financial disclosure refers to information that is not limited to traditional financial indicators, but also includes environmental, social, corporate governance, social responsibility, sustainability, transparency, and disclosure of non-financial risks.
The study is based on the basic hypothesis that investors no longer rely only on financial data to make their investment decisions, but have become increasingly important to non-financial information because of its role in reducing information asymmetry, enhancing trust, improving the mental image of companies, and raising the level of credibility and transparency. The study also assumes that the level of non-financial disclosure varies among the companies studied, and that this disparity is reflected in the divergence of investors' decisions and investment trends.
The study relied on the descriptive-analytical approach and the applied field approach through a questionnaire addressed to a sample of investors and dealers in the stock market, in addition to analyzing the content of the annual reports and sustainability reports issued by the two companies during a specific period of time. Appropriate statistical methods were used to test the hypotheses and analyze the relationships between the study variables.
The expected results found that there is a statistically significant relationship between the level of non-financial disclosure and investors' decisions, as it was found that clear disclosure of social responsibility, corporate governance and sustainability contributes to enhancing investor confidence and increasing their tendencies to invest long-term in telecommunications sector companies. The results also indicated that companies with a higher level of non-financial transparency have a better mental image and a higher investment valuation from the point of view of investors. The study recommends the need to strengthen non-financial disclosure practices in the Iraqi companies, and adopt clear and uniform disclosure standards in line with recent trends in integrated reporting and sustainability
Downloads
References
First: Arab Sources
1. Abu Nassar, Mohamed (2020). International Accounting and Financial Reporting Standards. Al-Masirah Publishing & Distribution, Amman, Jordan.
2. General Secretariat of the Council of Ministers (2021). Governance Standards Manual for Joint Stock Companies in Iraq. Baghdad, Iraq.
3. Hammad, Tariq (2019). Financial Reporting: Disclosure and transparency in the capital markets. University House, Alexandria, Egypt.
4. Asiacell Telecom Company (2023). Annual Report and 2022 Sustainability Report. Sulaymaniyah, Iraq.
5. Zain Iraq (2023). Annual Sustainability Report: Promoting Digital Inclusion. Baghdad, Iraq.
6. Arab Monetary Fund (2022). The Reality of Disclosure of ESG Sustainability Standards in the Arab Financial Markets. Abu Dhabi, UAE.
7. Iraqi Securities Commission Law No. (74) of 2004. Iraqi Chronicle, Baghdad.
8. Iraqi Securities Commission (2022). Annual Report to Evaluate the Performance of Companies Listed on the Iraq Stock Exchange.
Second: Foreign Sources (Alphabetical Order A-Z)
9. Adams, C. A., & Abhayawansa, S. (2018). Connecting the integrated report: A user perspective. Accounting, Auditing & Accountability Journal.
10. Eccles, R. G., & Serafeim, G. (2013). The Role of Corporate Sustainability in Creating Value for Consumers and Investors. Journal of Applied Corporate Finance.
11. Global Reporting Initiative (GRI). (2021). GRI Standards: Consolidated Set of GRI Sustainability Reporting Standards. Amsterdam, Netherlands.
12. IASB (International Accounting Standards Board). (2022). IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information. London, UK.
13. Khan, M., Serafeim, G., & Yoon, A. (2016). Corporate Sustainability: First Evidence on Materiality. The Accounting Review, 91(6).
14. Sustainability Accounting Standards Board (SASB). (2022). Telecommunication Services: Sustainability Accounting Standard. San Francisco, USA.
15. Zain Group (2023). Thought Leadership: The Evolution of ESG in the Telecommunications Sector.
Third: Websites
16. Iraq Stock Exchange (ISX). Official Website: www.isx-iq.net
17. Iraqi Securities Commission (ISC). Official Portal: www.isc.gov.iq
18. World Federation of Exchanges (WFE). Sustainability Initiatives: www.world-exchanges.org
