Does Silence Speak? An Empirical Analysis of Disclosure Choices during Conference Calls

Hollander, Stephan; Pronk, Maarten; Roelofsen, Erik

doi:10.2139/ssrn.1264966

Cited by 61 publications

(55 citation statements)

References 76 publications

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“…Second, information asymmetry between insiders and outsiders brings about adverse selection costs to a firm. The disclosure literature (e.g., Milgrom, ; Verrecchia, ; Hollander, Pronk and Roelofsen, ) provides strong support for the proposition that investors tend to equate no news with bad news. Absence of any disclosure induces investors to rationally infer that a firm's asset value is low or of high risk (Grossman, ; Beyer, Cohen, Lys and Walther, ).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Credit Ratings and Managerial Voluntary Disclosures

2018

The Financial Review

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This study investigates whether managers influence credit ratings via voluntary disclosures. I find that firms near a rating change have a higher incidence of a disclosure regarding product and business expansion (PBE) plans. This finding is more evident for firms that are subject to lower proprietary costs of disclosures, which implies that managers do trade off both the benefits and costs of the disclosures. I find no evidence that firms close to a rating change selectively release good news or suppress bad news on PBE. Overall, my results suggest that firms generally exhibit a credible commitment to maintaining disclosure transparency for a desired credit rating.

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Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Credit Ratings and Managerial Voluntary Disclosures

2018

The Financial Review

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“…Related evidence suggests that management considers the characteristics of the participating analysts when shaping the content of calls (Mayew, ; Bushee et al., ). However, this literature largely focuses on managers ’ disclosure choices during a conference call (see also Hollander et al., ). Thus, prior research provides limited evidence about analysts ’ incentives in shaping the content of a conference call's Q&A session by their information requests.…”

Section: Related Literature and Empirical Predictionsmentioning

confidence: 99%

Fair Value‐related Information in Analysts’ Decision Processes: Evidence from the Financial Crisis

Bischof¹,

Daske²,

Sextroh

2014

Business Fin & Account

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We use a sample of conference calls and analyst research reports from international banks to examine how financial analysts request and communicate fair value-related information in their valuation process. We find that analysts devote considerable attention to fair valuerelated topics. Most of the conference call questions and references in research reports pertain to fair value reclassifications and fair value changes of liabilities resulting from banks' own credit risk. The accounting impact of these one-time effects during the financial crisis and a lack of corresponding firm disclosures help to explain the prevalence of these two topics. The content of the questions and references suggests that analysts have different motives for their interest in fair value-related information. While some analysts adjust reported earnings for unrecognised fair value changes of reclassified assets, most of the observed analysts exclude banks' own credit risk effects from reported earnings. Thus, the use of fair value-related information varies substantially across analysts and across instruments.

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“…Indeed, the absence of such information should cause shareholders to question whether management has a comprehensive grasp of the business and whether the board is properly exercising its oversight responsibility." For conference calls, Hollander et al (2010) document strong support for the assumption maintained in the literature that investors interpret silence negatively: "no news = bad news. "…”

Section: More Disclosure On Good Newsmentioning

confidence: 74%

Voluntary Disclosure of Corporate Strategy: Determinants and Outcomes - An Empirical Study into the Risks and Payoffs of Communicating Corporate Strategy

Coebergh

2011

SSRN Journal

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VOLUNTARY DISCLOSURE OF CORPORATE STRATEGY: DETERMINANTS AND OUTCOMESKeywords: Voluntary disclosure, corporate strategy.Business leaders increasingly face pressure from stakeholders to be transparent. There appears however little consensus on the risks and payoffs of disclosing vital information such as corporate strategy. To fill this gap, this study analyzes firm-specific determinants and organisational outcomes of voluntary disclosure of corporate strategy. Stakeholder theory and agency theory help to understand whether companies serve their interest to engage with stakeholders and overcome information asymmetries. I connect these theories and propose a comprehensive approach to measure voluntary disclosure of corporate strategy. Hypotheses from the theoretical framework are empirically tested through panel regression of data on identified determinants and outcomes and of disclosed strategy through annual reports, corporate social responsibility reports, corporate websites and corporate press releases by the 70 largest publicly listed companies in the Netherlands from 2003 These questions triggered the writing of this dissertation, being a professional consultant and public relations executive, trying to understand the dynamics of communicating corporate strategy. Or as the topic is formulated in management research terminology:exploring determinants and organisational outcomes of voluntary disclosure of corporate strategy. 8 Research objective and methodologyBased on the identified gap in business practice and academic research, this section formulates the research objective, research questions and methodology of my research. A justification on the methodology is provided, followed by the pursued usefulness of this research for research and business practice. Research objective and research questionsTo fill the gap in business practice and in academic research on voluntary disclosure of corporate strategy, the research objective of this thesis is formulated as follows: To develop understanding and provide empirical evidence that help leaders of publicly listed companies understand how voluntary disclosure of corporate strategy contributes to corporate success.This research objective drives the following research questions:1. What are determinants of voluntary disclosure of corporate strategy?2. What are outcomes of voluntary disclosure of corporate strategy? MethodologyAs no earlier comprehensive research is known on voluntary disclosure of corporate strategy, literature research is conducted to construct a (preliminary) theoretical framework to identify and formulate the determinants and outcomes of voluntary disclosure of corporate strategy. The hypotheses that are based on these determinants and 9 outcomes are tested in a large-scale quantitative study, based on secondary data, available in the public field. The data are longitudinal, spanning a period of six years.The research questions are answered using the following process:• A theoretical framework is constructed to explain volu...

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Does Silence Speak? An Empirical Analysis of Disclosure Choices during Conference Calls

Cited by 61 publications

References 76 publications

Credit Ratings and Managerial Voluntary Disclosures

Credit Ratings and Managerial Voluntary Disclosures

Fair Value‐related Information in Analysts’ Decision Processes: Evidence from the Financial Crisis

Voluntary Disclosure of Corporate Strategy: Determinants and Outcomes - An Empirical Study into the Risks and Payoffs of Communicating Corporate Strategy

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