Corporate Information Disclosure Research Articles

Corporate Information Disclosure of Listed Banks from Kerala

Corporate Information Disclosure of Listed Banks from Kerala

Corporate Actors and Development Outcomes

In 2015, member countries of the United Nations adopted a set of goals to end poverty, protect the planet, and ensure prosperity for all as part of a new sustainable development agenda. Commonly referred to as the Sustainable Development Goals (SDGs), they set targets along 17 dimensions for signatories to reach by 2030. This symposium addresses how corporate actors can take on these challenges in conjunction with their strategic and financial goals using multi-stakeholder partnerships. Cross-sector Convergence: Building Sustainable Collaborative Initiatives Inside For-Profit Firms Presenter: Christiane Bode; Bocconi U. Presenter: Jasjit Singh; INSEAD How “Developmental” are Multilateral Development Banks? Presenter: Himanshu Bhatt; ESSEC Business School Presenter: Srividya Jandhyala; ESSEC Business School Corporate Information Disclosure: Formal vs. Informal Presenter: Eun-Hee Kim; Fordham U. Is Global Capital Sensitive to Misconduct? Presenter: Christopher B. Yenkey; Darla Moore School of Business, U. of South Carolina

Accounting information comparability, demand differences and cross-firm information transfer

ABSTRACTStudies of the economic consequences of accounting information comparability mainly focus on the level of the individual firm. There is little direct empirical evidence that investors use comparability for cross-firm investment. This paper empirically examines the impact of accounting information comparability on cross-firm information transfer from the perspective of investor information demand. We find that increases in comparability can facilitate the transfer of earnings information across firms, regardless of whether the investor uses the information to expect unknown or verify existing information. However, when the reliability of accounting information changes, the role of comparability is different. We also find that property rights and the information environment affect comparability’s influence. Finally, the use of comparable information by investors will reduce the market response to the firm’s earnings information. In summary, comparability plays an important role in investors’ acquisition and use of external information to assess a firm’s value. Our study provides a more comprehensive understanding of the economic consequences of accounting information comparability and has important implications for corporate information disclosure and government regulation.

Corporate Governance, Disclosure Quality, and Cost of Equity: Evidence from Pakistan

The link between disclosure of corporate information and the cost of equity in firms is one of the most important issues in finance. This paper aims to examine the connection between corporate governance, disclosure quality of information, and the cost of equity in Pakistani-listed (PSX-listed) firms. Using the Generalized Methods of Movements (Sys-GMM) model, a sample of 167 non-financial firms listed on Pakistan Stock Exchange (PSX) for the period of 2011-2015was analyzed. Sys-GMM estimation was applied to overcome the problem of endogeneity among corporate governance variables. To test the robustness of GMM estimations, we compared the results of pooled ordinary least squares (OLS) and fixed-effect estimations and found they did not overcome the problem of endogeneity, providing spurious results. We found a negative association between cost of equity and disclosure quality of financial statements. The findings suggested that the board size, concentrated ownership and CEO duality, are found as significant factors in reducing the cost of equity of PSX-listed firms. Audit committee independence and audit quality of the firm showed a positive relationship with the firm’s cost of equity. Our findings suggest that employing a high-quality auditor and independent director’s results in increased cost of equity for PSX-listed firms. Furthermore, no significant relationship between independence of the boards and duration of the authorizations of financial statements by the board of directors is found. The results also revealed the investors demand more return on their investments if inadequate and incomplete information is disclosed in the annual reports of the firms. This study provides useful insights for Pakistani corporate governance regulators, the executive management of Pakistani firms, and their investors.

Influence of Corporate Information Disclosure on Community and Society Development on Firm's Marketing Performance of Companies Listed on The Stock Exchange of Thailand

Influence of Corporate Information Disclosure on Community and Society Development on Firm's Marketing Performance of Companies Listed on The Stock Exchange of Thailand

Influence of Corporate Information Disclosure on Community and Society Development on Firm's Marketing Performance of Companies Listed on the Stock Exchange of Thailand

Influence of Corporate Information Disclosure on Community and Society Development on Firm's Marketing Performance of Companies Listed on the Stock Exchange of Thailand

Environmental Governance in China: State, Society, and Market

This article provides an analytical overview of major works on the topic of environmental governance in China, with a particular emphasis on studies examining policies during the reform era (post-1978). We begin by exploring the rise of China’s “environmental state” and the various institutional and political factors that shape state behavior. Next, we describe the complex relationship between the Chinese state and society, analyzing studies related to environmental public opinion, citizen action, nongovernmental organizations ( NGO s), green civil society, the role of the media, and China’s judiciary. Finally, we conclude by reviewing research on market-based mechanisms of environmental governance in China, including emissions trading schemes, environmental transparency, corporate information disclosure, and green finance.

Financial Disclosure and the Cost of Equity Capital: The Empirical Test of the Largest Listed Companies of Kazakhstan

This study extends research into whether disclosure of corporate and financial information is associated with firms' costs of equity capital. This study sets out to examine empirically the determinants of corporate disclosure in the annual reports of 37 largest and most liquid firms listed on Kazakhstan Stock Exchange (KASE) in Kazakhstan. It also reports the results of the association between company-specific characteristics and disclosure of the sample companies. Based on the analysis of existing empirical research, the disclosure index has been constructed and regression analysis of the influence of the disclosure index on the cost of equity capital has been conducted. The obtained results show that the received findings correlate with foreign empirical studies, and the disclosure index in this sample has a negative impact on the cost of equity capital. Using cost of equity capital estimates derived from capital asset pricing model, we find that firms with higher levels of financial transparency are associated with significantly lower costs of equity capital. Economic theory assumes that by increasing the level of corporate reporting, firms not only increase their stock market liquidity, but also decrease the investors' estimation risk, arising from uncertainty about future returns and payout distributions. The results show that firms on the Kazakhstan market can reduce their cost of equity capital by increasing the level of their voluntary corporate disclosures.

The governance role of institutional investors in information disclosure

PurposeAs an important participant in capital market, institutional investors play a principal role in improving corporate governance. Most existing studies have focused on institutional ownership and its economic consequences. Nevertheless, they have not provided sufficient insight on the governance behavior of institutional investors as well as the underlying incentive mechanism. This paper aims to analyze the governance role of institutional investors in information disclosure and provide related evidence.Design/methodology/approachThe authors propose a novel theory to analyze the institutional investors’ behavior of active governance and shows that such behavior significantly improves the quality of corporate information disclosure. The authors then conduct an empirical test by using the hand-collected data of institutional investors’ corporate visits during 2009-2014 in ChiNext.FindingsThis paper finds that the firms visited by institutional investors are more likely to have a greater tendency of disclosing more information than the firms that have never been visited. In particular, a higher frequency of visits or a larger number of participating institutional investors leads to a higher degree of disclosure. Consistent with the notion that on-site visits endow institutional investors with more frequent and active interaction with the firms, the authors find that the results are stronger for firms which are visited on-site, when compared with other information acquisition activities such as online meetings, conference calls and investor meetings. In addition, the effect of a site visit is greater when the site visit is conducted by securities companies or funds rather than insurance companies or QFIIs. Finally, the test of the direction of causality suggests that visits conducted by institutional investors leads to more information disclosure, rather than the reverse. Collectively, these results show that institutional investors’ participation enhances corporate information disclosure.Originality/valueThis paper explores the internal mechanism that institutional investors affect corporate governance by improving information disclosure through their corporate visits. This is the first study to investigate the influence of institutional investors’ corporate visits and their economic consequences.

The effects of bank mergers on corporate information disclosure

Applying a difference-in-differences approach to explore variations in the timing of bank mergers in the U.S. over the last two decades, we document an increase in borrowers’ disclosure when their banks engage in mergers and acquisitions. The effect is stronger among borrowers more reliant on services from the merging banks and when mergers cause larger changes in banks’ monitoring and financing of borrowers. These findings suggest an information spillover effect from bank mergers to the public financial markets, and have implications for how changes in banking markets affect the availability of public disclosure in the stock markets.

RELATIONSHIP ANALYSIS BETWEEN DISCLOSURE ON THE INTERNET, RISK AND RETURN IN LATIN AMERICAN COMPANIES

ABSTRACT Purpose: This study sought to examine the extent to which the internet it is utilized as a tool for the disclosure of corporate information, facilitating the transparency of companies in relation to their stakeholders. Originality/gap/relevance/implications: This study differs from previous as it fills a gap in the literature to relate a disclosure measure on the internet with the risk and return of companies in Latin America, since this literature is only possible to identify studies that analyze these variables independently or with respect to other factors. Key methodological aspects: The sample included 758 companies listed on four major exchanges in Latin America (Argentina, Chile, Brazil and Mexico), and its disclosure level was quantified and its relationship with risk and return were verified by Tobit regressions. Summary of key results: The results show that it is possible to observe that the issue of ADRs, the size and liquidity affect the relationship between disclosure, risk and return. Also, the disclosure has advanced in the region over the years, especially in Brazil. However, no significant differences were identified between the countries, to the point of impact relations with the risk and return of companies. Key considerations/conclusions: The main contributions are the expansion of evidence on these variables, relating them to each other in emerging markets.

After Halliburton: Event Studies and Their Role in Federal Securities Fraud Litigation

Event studies have become increasingly important in securities fraud litigation after the Supreme Court’s decision in Halliburton II. Litigants have used event study methodology, which empirically analyzes the relationship between the disclosure of corporate information and the issuer’s stock price, to provide evidence in the evaluation of key elements of federal securities fraud, including materiality, reliance, causation, and damages. As the use of event studies grows and they increasingly serve a gatekeeping function in determining whether litigation will proceed beyond a preliminary stage, it will be critical for courts to use them correctly. This Article explores an array of considerations related to the use of event studies in securities fraud litigation. It starts by describing the basic function of the event study: to determine whether a highly unusual price movement has occurred and the traditional statistical approach to making that determination. The Article goes on to identify special features of securities fraud litigation that distinguish litigation from the scholarly context in which event studies were developed. The Article highlights the fact that the standard approach can lead to the wrong conclusion and describes the adjustments necessary to address the litigation context. We use the example of six dates in the Halliburton litigation to illustrate these points. Finally, the Article highlights the limitations of event studies – what they can and cannot prove – and explains how those limitations relate to the legal issues for which they are introduced. These limitations bear upon important normative questions about the role event studies should play in securities fraud litigation.

Stock market’s reaction to self-disclosure of work safety accidents: an empirical study in China

Work safety accidents are one of the major technological risks that modern enterprises face. As investors became more concerned about information justice, the study of the relationship between corporate negative information disclosure and their stock market returns is of practical significance. In this study, the stock market’s reaction to information self-disclosure of safety accidents is investigated multi-dimensionally for Chinese listed firms, including variables such as timing of information release, firm ownership, industry type, media attention to the accident, and the number of deaths. Based on 130 industrial accidents announcements made by publicly listed firms in China from 2007 to 2014, we use the event study method to investigate the extent to which the stock market responds to the safety accidents announcements. The relationship between accumulative abnormal return and its impact factors is examined by multivariate analysis. The results indicate that the stock market reacts negatively after the self-disclosure of work safety accidents. Our results also suggest that several factors—timing of information release, firm ownership and industry type, have significant effects on firms’ reactions in terms of market value.

Literature Review on the Impression Management in Corporate Information Disclosure

The presentation of corporate disclosure may be explained by impression management. Previous studies find the existence of impression management in the corporate information disclosure including the financial information disclosure and the non-financial information disclosure. This paper is going to make a complete literature review on these studies related to impression management.

Corporate Governance and Stock Market Liquidity

Corporate governance has an impact on both quantity and quality of corporate information disclosure which affects the level of information asymmetry and thus impacts the changes in market liquidity of stock. This article attempts to discern the relationship between corporate governance and the stock market liquidity of Indian manufacturing companies included in the S&P BSE 100 Index during the period 2009-2012 by invoking pooled regression model. The empirical results support corporate governance implications of stock market liquidity as measured by Amivest measure (1985), that is, better governed companies has higher liquidity. The results of the present study are in support of arguments made by Chung, Elder, and Kim (2010), i.e., firms may improve stock market liquidity by adopting corporate governance practices that mitigate informational asymmetries.

La composición del consejo de administración y la estructura accionaria como factores explicativos de la transparencia en el gobierno corporativo en Latinoamérica: evidencia en empresas cotizadas de Argentina, Brasil, Chile y México

The objective of this paper is to obtain empirical evidence of the relationship between board structure, ownership composition, and the level of corporate governance transparency in the largest listed companies of Latin America. A correlational study was conducted with a longitudinal analysis using data from the largest listed comanies in Argentina, Brazil, Chile and Mexico during the period 2004-2010. The results show that the level of transparency is higher in companies with larger boards and with a higher percentage of independent directors. Meanwhile, the composition of ownership inhibits the level of transparency in corporate governance, while the presence of family shareholders encourages greater disclosure of corporate information.

Corporate governance for financial market infrastructures

This article provides an analysis of the corporate governance practices across financial market infrastructures (FMIs). Although there are no mandatory global standards, the CPSS IOSCO Principles for FMIs provide a general guidance that will be the corporate governance norm in the future. Such standards are based on six criteria used to assess the level of compliance including board arrangements, establishment and monitoring of the risk management framework, performance assessment management, establishment of users groups, disclosure of corporate information and disclosure of statistical information.

The Impact of Pension Systems on Financial Development: An Empirical Study

The impact of pension assets on financial development is both quantitatively and qualitatively. On quantitatively, pension funds increase capital supply to financial market. On qualitatively, pension funds as institutional investors could promote corporate governance, information disclosure and transaction efficiency. Based on regression results of 55 countries and regions, we find that different pension systems formed different size of pension fund; every 1% increase of the pension funds’ assets could bring about 0.15%-0.23% increase of the market value, which could explain cross-countries difference of financial development. Based on panel data analysis, we find that the impact of pension fund on financial development is very significant especially in civil law and underdeveloped countries. By using co-integration analysis and vector auto regression model（VAR）with time series data of Chile, we find positive relationship between pension funds and financial development again. The empirical results indicate that legal origin, endowment and pension fund views are not exclusive but compatible. A country cannot change its legal origin and endowment, but it can change pension policies and reform social security system. A funded pension system with accumulates pension assets could promote a country’s financial development and economic growth.

The Effects of Bank Mergers on Corporate Information Disclosure

Applying a difference-in-differences approach to explore variations in the timing of bank mergers in the U.S. over the last two decades, we document significant increase in borrowers’ disclosure when their lead banks engage in merger and acquisition activities. The effect is stronger among borrowers more reliant on services from the merging banks and when mergers cause larger changes in banks’ monitoring and financing of borrowers. These findings suggest an information spillover effect from bank mergers to the public financial markets, and have implications for how changes in U.S. banking markets affect the availability of public disclosure in the stock markets.

Revelación de información en las empresas bursátiles chilenas: el efecto de la propiedad de los inversionistas institucionales y el nivel de endeudamiento

This article provides evidence of the effect the quality of corporate information disclosure has on the market, particularly the share of ownership that have the pension fund adminstrators who have shares in the company, and the level of debt that the companies have. Cross-sectional econometric models and panel data were use to measure and quantify this evidence, found by using information published by Chilean Corporations between 2001-2009. The study shows that, for this sample, information disclosure increases when the pension funds ownership is higher, and decreases when the leverage is higher.