Voluntary Disclosure and Relational Connectivity - The Case of the Polish Bond Market

• Autorzy: Dominika Hadro , Marek Pauka , Kamil Gemra , Szymon Okoń , Justyna Fijałkowska
• Języki publikacji: EN

Abstrakty

EN

The purpose of our research is to evaluate the voluntary disclosure strategy and effective communication between issuers and investors on the Polish bond market Catalyst. We conducted a questionnaire among issuers on the Catalyst. To evaluate the data and find answers to the research questions, we used the Qualitative Comparative Analysis. As our analysis shows that management board engagement seems crucial for effective communication, we claim that in relatively smaller capital markets, personal engagement of board members in preparing voluntary disclosure should be considered a proxy of a high disclosure strategy quality. We prove that companies use dialogue with investors in private rather than in public to understand their communication expectations. This finding indicates the essential limitations of previous research evaluating relational connectivity through social media. We point out the existence of many paths to achieve a high level of companies' perception of investors' voluntary disclosure needs and companies' relational connectivity regarding voluntary disclosure. We developed a new approach to measuring relational connectivity, which can be successfully applied to other markets and stock exchanges, allowing verification of previous findings and the development of a new approach to conducting research. We claim that it is necessary to put more pressure on the management board's engagement in preparing the financial report as it is crucial for understanding investors' voluntary disclosure needs. Our conclusions question the growing societal pressure on engaging in activity in social media as a key concept of effective communication. (original abstract)

Słowa kluczowe

PL

Jawność informacji; Rynek obligacji; Komunikowanie w biznesie; Efektywne komunikowanie

EN

Information disclosure; Bond market; Business communication; Effective communication

• Czasopismo: Journal of Banking and Financial Economics
• Rocznik: 2022
• Numer: nr 2(18)
• Strony: 30-48

Twórcy

autor

Dominika Hadro

• Wroclaw University of Economics and Business, Poland

autor

Marek Pauka

• Wroclaw University of Economics and Business, Poland

autor

Kamil Gemra

• Warsaw School of Economics, Poland

autor

Szymon Okoń

• Warsaw School of Economics, Poland

autor

Justyna Fijałkowska

• University of Lodz, Poland

Bibliografia

• 1. Ajinkya, B., Bhojraj, S., & Sengupta, P. (2005). The association between outside directors, institutional investors, and the properties of management earnings forecasts. Journal of Accounting Research, 43(3), 343-375. https://doi.org/10.1111/j.1475-679x.2005.00174.x
• 2. Asay, H. S., Libby, R., & Rennekamp, K. M. (2018). Do features that associate managers with a message magnify investors' reactions to narrative disclosures? Accounting, Organisations and Society, 68, 1-14. https://doi.org/10.1016/j.aos.2018.02.003
• 3. Balakrishnan, K., Billings, M., Kelly, B., & Ljungqvist, A. (2014). Shaping liquidity: On the causal effects of voluntary disclosure. The Journal of Finance, 69, 2237-2278. https://doi.org/10.1111/jofi.12180
• 4. Bamber, L. S., Jiang, J. (Xuefeng), & Wang, I. Y. (2010). What's my style? The influence of top managers on voluntary corporate financial disclosure. The Accounting Review, 85(4), 1131-1162. https://doi.org/10.2308/accr.2010.85.4.1131
• 5. Bardos, K. S. (2011). Quality of financial information and liquidity. Review of Financial Economics, 20(2), 49-62. https://doi.org/10.1016/j.rfe.2011.01.001
• 6. Barry, C. B., & Brown, S. J. (1985). Differential information and security market equilibrium. Journal of Financial and Quantitative Analysis, 20(4), 407-422. https://doi.org/10.2307/2330758
• 7. Bebczuk, R. N. (2003). Asymmetric information in financial markets: Introduction and applications. Cambridge University Press.
• 8. Benabou, R., & Tirole, J. (2002). Self-confidence and personal motivation. The Quarterly Journal of Economics, 117(3), 871-915. https://doi.org/10.1162/003355302760193913
• 9. Beyer, A., Cohen, D. A., Lys, T. Z., & Walther, B. R. (2010). The financial reporting environment: Review of the recent literature. Journal of Accounting and Economics, 50(2), 296-343. https://doi.org/10.1016/j.jacceco.2010.10.003
• 10. Beyer, A., & Guttman, I. (2012). Voluntary disclosure, manipulation, and real effects. Journal of Accounting Research, 50(5), 1141-1177. https://doi.org/10.1111/j.1475-679X.2012.00459.x
• 11. Blankespoor, E. (2018). Firm communication and investor response: A framework and discussion integrating social media. Accounting, Organisations and Society, 68-69, 80-87. https://doi.org/10.1016/j.aos.2018.03.009
• 12. Blankespoor, E., deHaan, E., & Marinovic, I. (2020). Disclosure processing costs, investors' information choice, and equity market outcomes: A review. Journal of Accounting and Economics, 70(2/3), 101344. https://doi.org/10.1016/j.jacceco.2020.101344
• 13. Blankespoor, E., Miller, G. S., & White, H. D. (2014). The role of dissemination in market liquidity: Evidence from firms' use of Twitter. The Accounting Review, 89(1), 79-112. https://doi.org/10.2308/accr-50576
• 14. Bochkay, K., Chychyla, R., & Nanda, D. (2019). Dynamics of CEO disclosure style. The Accounting Review, 94(4), 103-140. https://doi.org/10.2308/accr-52281
• 15. Botosan, C. A. (1997). Disclosure level and the cost of equity capital. Accounting Review: A Quarterly Journal of the American Accounting Association, 72, 323-349.
• 16. Brennan, N. M., & Merkl-Davies, D. M. (2018). Do firms effectively communicate with financial stakeholders? A conceptual model of corporate communication in a capital market context. Accounting and Business Research, 48(5), 553-577. https://doi.org/10.1080/00014788.2018.1470143
• 17. Bryl, Ł., Fijałkowska, J., & Hadro, D. (2021). Intellectual capital disclosure on Twitter - Empirical evidence from the world's largest companies. Meditari Accountancy Research. Advance online publication. https://doi.org/10.1108/MEDAR-02-2021-1211
• 18. Cade, N. L. (2018). Corporate social media: How two-way disclosure channels influence investors. Accounting, Organizations and Society, 68, 63-79. https://doi.org/10.1016/j.aos.2018.03.004
• 19. Charness, G., Rustichini, A., & van de Ven, J. (2018). Self-confidence and strategic behavior. Experimental Economics, 21(1), 72-98. https://doi.org/10.1007/s10683-017-9526-3
• 20. Cheng, C.-F., Chang, M.-L., & Li, C.-S. (2013). Configural paths to successful product innovation. Journal of Business Research, 66(12), 2561-2573. https://doi.org/10.1016/j.jbusres.2012.10.006
• 21. Cho, H., & Kim, R. (2021). Asymmetric effects of voluntary disclosure on stock liquidity: Evidence from 8-K filings. Accounting & Finance, 61(1), 803-846. https://doi.org/10.1111/acfi.12594
• 22. Cuadrado-Ballesteros, B., Martínez-Ferrero, J., & García-Sánchez, I. M. (2017). Board structure to enhance social responsibility development: A qualitative comparative analysis of US companies. Corporate Social Responsibility and Environmental Management, 24(6), 524-542. https://doi.org/10.1002/csr.1425
• 23. Cucari, N. (2019). Qualitative comparative analysis in corporate governance research: A systematic literature review of applications. Corporate Governance: The International Journal of Business in Society, 19(4). https://doi.org/10.1108/CG-04-2018-0161
• 24. Diamond, D. W. (1985). Optimal release of information by firms. The Journal of Finance, 40, 1071-1094. https://doi.org/10.1111/j.1540-6261.1985.tb02364.x
• 25. Diamond, D. W., & Verrecchia, R. E. (1991). Disclosure, liquidity, and the cost of capital. The Journal of Finance, 46(4), 1325-1359. https://doi.org/10.1111/j.1540-6261.1991.tb04620.x
• 26. Richards, D. W., & Safari, M. (2021). Disclosure effectiveness in the financial planning industry. Qualitative Research in Financial Markets. Advance online publication. https://doi.org/10.1108/CG-04-2018-0161
• 27. Drake, M. S., Thornock, J. R., & Twedt, B. J. (2017). The internet as an information intermediary. Review of Accounting Studies, 22(2), 543-576. https://doi.org/10.1007/s11142-017-9395-1
• 28. Dyer, T., Lang, M., & Stice-Lawrence, L. (2017). The evolution of 10-K textual disclosure: Evidence from Latent Dirichlet Allocation. Journal of Accounting and Economics, 64(2/3), 221-245. https://doi.org/10.1016/j.jacceco.2017.07.002
• 29. Easley, D., & O'Hara, M. (2004). Information and the cost of capital. The Journal of Finance, 59(4), 1553-1583. https://doi.org/10.1111/j.1540-6261.2004.00672.x
• 30. Elliott, W. B., Grant, S. M., & Hodge, F. D. (2018). Negative news and investor trust: The role of $Firm and

Identyfikatory

DOI

10.7172/2353-6845.jbfe.2022.2.3