CORPORATE GOVERNANCE AND INTEGRATED REPORTING AS COMPLEMENTARY AGENCY MECHANISMS: EVIDENCE FROM JOHANNESBURG SECURITY EXCHANGE LISTED FIRMS

Abstract

This study examines the nexus between corporate governance, integrated reporting, and firm financial performance through the lens of agency theory. The separation of ownership and control creates information asymmetries that expose firms to managerial opportunism, necessitating monitoring and disclosure mechanisms to align managerial behaviour with shareholder interests. Corporate governance and integrated reporting are conceptualised as complementary agency-control mechanisms that reduce agency costs and enhance organisational outcomes. Using panel data from firms listed on the Johannesburg Stock Exchange (JSE) over the period 2017–2022, the study employs panel and ordered regression models to evaluate the individual and joint effects of governance quality and reporting quality on accounting-based and market-based performance measures. The results indicate that stronger governance improves profitability and reporting quality, while integrated reporting is positively associated with market valuation. However, the interaction between governance and reporting is not statistically significant, indicating that the combined monitoring and disclosure mechanisms do not produce a measurable joint effect on firm financial performance in the sampled firms. The findings contribute to the corporate governance literature by providing an integrated agency-theory explanation of how accountability mechanisms jointly influence value creation and offer practical implications for regulators and firms seeking to strengthen transparency and performance. JEL classification: G32, G34, M41 Article History: Received: March 9, 2026; Reviewed: July 11, 2026; Accepted: August 31, 2026; Available online: September 23, 2026.