Between a Rock and a Hard Place : New Evidence on the Relationship between Ownership and Voluntary Disclosure
(2018) In International Review of Financial Analysis 56. p.281-291- Abstract
- Combining two Swedish databases with unique strengths I show empirically that stray firms, i.e. those lacking a controlling owner, have lower voluntary disclosure in financial reports (that is, information provided beyond what is formally required). This suggests managers prefer to withhold information to maximize their discretion over corporate policies. I also show that disclosure initially increases with block ownership, reflecting increased incentives to monitor and stronger governance. However, when block ownership exceeds a certain threshold level (>50%), disclosure starts to decrease, reflecting another conflict of interest, namely between minority and controlling owners. Evidence of this non-linear relationship is novel in the... (More)
- Combining two Swedish databases with unique strengths I show empirically that stray firms, i.e. those lacking a controlling owner, have lower voluntary disclosure in financial reports (that is, information provided beyond what is formally required). This suggests managers prefer to withhold information to maximize their discretion over corporate policies. I also show that disclosure initially increases with block ownership, reflecting increased incentives to monitor and stronger governance. However, when block ownership exceeds a certain threshold level (>50%), disclosure starts to decrease, reflecting another conflict of interest, namely between minority and controlling owners. Evidence of this non-linear relationship is novel in the literature and may account for the mixed evidence in previous research. Moreover, I report findings on the impact of institutional, foreign, under-diversified, and controlling minority-owners, concluding that ownership structure has major implications for voluntary disclosure. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/d046d28d-5fb3-480e-8966-f875c6ac48d2
- author
- Jankensgård, Håkan LU
- organization
- publishing date
- 2018
- type
- Contribution to journal
- publication status
- published
- subject
- keywords
- voluntary disclosure, ownership, monitoring, agency costs, block ownership, G30, G32
- in
- International Review of Financial Analysis
- volume
- 56
- pages
- 281 - 291
- publisher
- Elsevier
- external identifiers
-
- scopus:85031129525
- ISSN
- 1057-5219
- DOI
- 10.1016/j.irfa.2017.09.009
- language
- English
- LU publication?
- yes
- id
- d046d28d-5fb3-480e-8966-f875c6ac48d2
- date added to LUP
- 2017-10-06 16:26:50
- date last changed
- 2025-04-04 15:00:42
@article{d046d28d-5fb3-480e-8966-f875c6ac48d2,
abstract = {{Combining two Swedish databases with unique strengths I show empirically that stray firms, i.e. those lacking a controlling owner, have lower voluntary disclosure in financial reports (that is, information provided beyond what is formally required). This suggests managers prefer to withhold information to maximize their discretion over corporate policies. I also show that disclosure initially increases with block ownership, reflecting increased incentives to monitor and stronger governance. However, when block ownership exceeds a certain threshold level (>50%), disclosure starts to decrease, reflecting another conflict of interest, namely between minority and controlling owners. Evidence of this non-linear relationship is novel in the literature and may account for the mixed evidence in previous research. Moreover, I report findings on the impact of institutional, foreign, under-diversified, and controlling minority-owners, concluding that ownership structure has major implications for voluntary disclosure.}},
author = {{Jankensgård, Håkan}},
issn = {{1057-5219}},
keywords = {{voluntary disclosure; ownership; monitoring; agency costs; block ownership; G30; G32}},
language = {{eng}},
pages = {{281--291}},
publisher = {{Elsevier}},
series = {{International Review of Financial Analysis}},
title = {{Between a Rock and a Hard Place : New Evidence on the Relationship between Ownership and Voluntary Disclosure}},
url = {{http://dx.doi.org/10.1016/j.irfa.2017.09.009}},
doi = {{10.1016/j.irfa.2017.09.009}},
volume = {{56}},
year = {{2018}},
}