Predictors of Corporate Governance Influencing IFRS Compliance: Empirical Evidence from Botswana’s Listed Companies
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Abstract
This study investigates the corporate governance predictors influencing International Financial Reporting Standards (IFRS) compliance among Botswana’s publicly listed companies. Although IFRS is mandatory under the Companies Act (2003) and the Accountants Act (2010), evidence shows persistent gaps in disclosure quality. A convergent mixed-methods design was employed, combining quantitative data from a structured corporate governance questionnaire administered to board members, audit committee members, and finance managers (n = 120), with secondary data extracted from the audited financial statements of 35 listed firms covering the period 2020–2024. Statistical procedures included descriptive analysis, correlation analysis, ANOVA, multiple regression, effect size estimation, and model diagnostic tests. Results indicate that audit committee effectiveness (β = 0.47, p < 0.01) and board independence (β = 0.39, p < 0.05) significantly enhance IFRS compliance, whereas ownership concentration exerts a negative effect (β = –0.31, p < 0.05). Board size shows a positive but marginal influence, while gender diversity demonstrates a positive yet statistically insignificant effect. The questionnaire analysis further reveals gaps in IFRS expertise, limited board capacity-building, and pressures from dominant shareholders as key barriers to compliance. Overally, the study concludes that strengthening audit committee competence, enhancing board independence, and reducing excessive ownership concentration are essential for improving IFRS adherence within Botswana’s capital markets. The study contributes to governance compliance literature in emerging markets and offers practical recommendations for regulators, policymakers, and corporate boards seeking to improve financial reporting quality.
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