Global Journal of Economic and Finance Research

Purpose: This paper develops a conceptual framework explaining how voluntary reporting influences the cost of capital of manufacturing companies listed on Bursa Malaysia, with information asymmetry as the central transmission mechanism.

Design/methodology/approach: A conceptual, model-building design is adopted, based on an integrative review of the disclosure, capital market and corporate governance literature and an analysis of the Malaysian reporting environment, including the Main Market Listing Requirements, the Malaysian Code on Corporate Governance and the National Sustainability Reporting Framework.

Findings: The paper identifies five dimensions of voluntary reporting relevant to manufacturers and proposes that higher-quality voluntary reporting reduces information asymmetry, which in turn lowers the cost of equity and debt capital. Reporting credibility is expected to strengthen, and ownership concentration to weaken, these relationships. Five propositions are advanced.

Conclusion: Voluntary reporting is a financing-relevant decision rather than a public relations exercise. The framework guides future empirical research and informs regulators, preparers and investors in an emerging market where the boundary between voluntary and mandatory reporting is shifting.

Voluntary reporting, information asymmetry, cost of equity, cost of debt, manufacturing firms, Bursa Malaysia

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