Operational risk disclosure quality and national culture: Evidence from the EU banking industry

Florence Pinto Basto, Ana Marques

Research output: Contribution to journalArticlepeer-review


In this study, we analyze the association between national culture and voluntary operational risk disclosure quality in the European Union banking industry. Complementarily, we assess whether the potential impact of culture differs between global banks and banks with low levels of internationalization. Finally, we consider the impact of the formal institutional environment. Our sample covers 15 countries, and we construct a disclosure score based on hand-collected data. Three main results were obtained. First, banks in societies that score higher on individualism or long-term orientation and lower on uncertainty avoidance or power distance have better disclosures. Second, in global banks, where executive board members interact with stakeholders from different cultures, these associations are absent. Finally, contextual factors also affect the association between culture and disclosure, but this substitution effect is weaker than the one we document for globalization. Our results are robust to instrumental variables estimation, the use of the GLOBE project’s cultural dimensions, and a subsample analysis of civil code law countries.
Original languageEnglish
Article number100614
JournalJournal of International Accounting, Auditing and Taxation
Early online date29 Mar 2024
Publication statusE-pub ahead of print - 29 Mar 2024

Cite this