Unlocking fintech disclosure: Exploring factors in Malaysia's banking sector

Background and Purpose: This study investigates the impact of fintech disclosure on Malaysian banks from 2018 to 2022. Fintech adoption has transformed the banking industry, necessitating enhanced transparency to meet stakeholder expectations and regulatory demands. Despite the growing significance of fintech disclosure, its determinants remain underexplored, particularly in developing economies like Malaysia. The purpose of this study is to examine how key factors, including Sustainable Development Goals (SDGs), investment strategy, market capitalization, risk management, and foreign ownership, influence fintech disclosure in the Malaysian banking sector. Methodology: The study employed a quantitative research approach, analyzing secondary data collected from the annual reports of 10 publicly listed Malaysian banks over five years (2018–2022), resulting in 50 firm-year observations. A panel data regression model was used to assess the relationships between the dependent variable (i.e. fintech disclosure) and the five independent variables (i.e. SDGs, investment strategy, market capitalization, risk management, and foreign ownership). Findings: The findings reveal that SDGs, investment strategy, market capitalization, and risk management are positively correlated with fintech disclosure, whereas foreign ownership demonstrates a negative correlation. These results align with established theories: stakeholder theory explains strategic responses to stakeholder interests, legitimacy theory highlights the role of social norms in shaping risk management and market behavior, and institutional theory demonstrates how external standards influence SDG-related disclosures. Contributions: This study provides valuable insights into the strategic adaptability of Malaysian banks in aligning disclosure policies with stakeholder expectations, regulatory constraints, and the evolving fintech landscape. By advancing the understanding of how fintech disclosure practices are shaped, this research contributes to the literature on corporate transparency and supports the development of policies promoting sustainable and socially responsible banking practices. Keywords: Fintech disclosure, Malaysian banks, sustainable development goals, stakeholder theory, legitimacy theory.