ISSN: 2222-6990
Open access
The rise in moral lapses and accounting scandals, like Cendant Corp, Tyco, Enron, WorldCom, Waste Management, Health South, and Parmalat, eroded confidence in financial information. Despite efforts to comply with regulations and strengthen corporate governance through the Malaysia Code of Corporate Governance (MCCG), scandals and poor performance affect government-related companies in Malaysia. Unethical practices and transparency issues persist, impacting corporate accountability, productivity, and public trust. This study examines the value relevance of financial information using the modified Ethical Commitment Index (ECI), analysing 300 companies’ annual reports from 2018 to 2020. The objective is to explore the impact of ethical practice disclosure on financial information’s value relevance. The findings indicate a significant relationship between ethical practice disclosure and value relevance, suggesting that businesses adhering to high ethical standards gain a competitive advantage and create shareholder value. This paper offers insights into the value relevance of financial information through ethical practice disclosure among the top 100 Malaysian public companies, with suggestions for future research.
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