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Corporate governance and transparency in Japan

Research output: Working paper



We examine whether the quality rating of a listed company’s corporate governance, in Japan, is related to its equity market transparency. Our data include disclosures and returns for over 1,700 firms for ten years ending 31 July 2013. We find firms with better corporate governance make more frequent disclosures. Examining good and bad news separately, we find better-governed firms make more frequent and timelier disclosures of good news, and their share prices reflect that news faster. However, we do not find the same results for bad news, which may help Japan’s corporate regulators as they focus their future efforts.