IJCISS Vol.03 Issue-02, (February, 2016) ISSN: 2394-5702 International Journal in Commerce, IT & Social Sciences (Impact Factor: 3.455) A Monthly Double-Blind Peer Reviewed Refereed Open Access International e-Journal - Included in the International Serial Directories International Journal in Commerce, IT & Social Sciences http://www.ijmr.net.in email id- irjmss@gmail.com Page 31 CORPORATE GOVERNANCE REPORTING LEGAL AND REGULATORY ENVIRONMENT IN ETHIOPIA TEFERI DEYUU ALEMI Department of Commerce, Punjabi University, Patiala, India And DR. J.S. PASRICHA (Professor) Department of Commerce, Punjabi University, Patiala, India ABSTRACT This paper examined the legal and regulatory environment of corporate governance and financial reporting practices in Ethiopia. After preparing an index for corporate governance items, data were collected from secondary sources using qualitative research through review of legal documents (such as Commercial codes, various proclamations, regulations and directives, etc.). The empirical results of the study has revealed that there is no adequate provision that requires the reporting of the Corporate governance characteristics and issues such as ownership structure, board size, board qualification, training, selection process, tenure period, age limit, internal control systems, audit rotation, and others issues like environment report, labor relation, social responsibility, risk management and the like either in Commercial code of 1960 or in the memorandum and articles of association or other special laws issued for regulating purpose by regulatory bodiesand no mandatory minimum disclosure requirementsof items that should be reported on the annual reports but organizations are disclosing voluntarily. Key Words: Corporate Governance; Corporate Governance Reporting; Ethiopia; Legal and Regulatory Environment 1. INTRODUCTION The existences of appropriate and effective legal, regulatory and institutional underpinnings are backbones for a given country’s sound corporate governance framework as sound corporate governance framework in turn fosters market integrity, improves economic efficiency and growth as well as builds investor confidence by mitigating agency problem(Gebeyawu, 2012). In the meantime, developing a national financial reporting framework is crucial because without this framework at a national level, it is common to see companies employ different accounting rules or principles or methods which in turn lead to production of different sets of financial statements whichlack the quality of comparability(Addis Fortune, 2009). Wulandari and Rahman (2004,p4) cited that Kothari (2000), Ball (2001), and Benston (2003) have argued that accounting standards on their own are ineffective mechanism of regulation