The impact of Corporate Governance on voluntary disclosure of R&D expenditure of USA Pharmaceutical firms

Abstract

This research examines the impact of corporate governance on voluntary disclosure of R&D expenditure of USA pharmaceutical firms. Most of the previous studies focus on relationship between corporate governance and performance of the firms but this research explores an impact of corporate governance on voluntary disclosure of R&D expenditure of USA Pharmaceutical firms’ as well as the impact of firm size, leverage, firm profitability, liquidity and firm growth on research and development expenditure of Pharmaceutical firms’ of USA. The sample of this study consists on forty three USA pharmaceutical listed firms from 2017 to 2020. In order to examine research questions, methodology is based on Generalize method of movement (GMM). Result showed that overall R&D disclosure has a significant impact with corporate governance variables including audit committee quality, managerial ownership, role duality and board independence. Furthermore research also found that firm profitability, firm size and as well as liquidity ratio have positive and significant impact on R&D development expenditure.