Rights statement: This is the peer reviewed version of the following article: Beekes, W., Brown, P., Zhan, W. and Zhang, Q. (2016), Corporate Governance, Companies’ Disclosure Practices and Market Transparency: A Cross Country Study. Journal of Business Finance & Accounting, 43: 263–297. doi: 10.1111/jbfa.12174 which has been published in final form at http://onlinelibrary.wiley.com/doi/10.1111/jbfa.12174/abstract This article may be used for non-commercial purposes in accordance With Wiley Terms and Conditions for self-archiving.
Accepted author manuscript, 340 KB, PDF document
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Final published version
Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
}
TY - JOUR
T1 - Corporate governance, companies’ disclosure practices, and market transparency
T2 - a cross country study
AU - Beekes, Wendy Anne
AU - Brown, Philip Ronald
AU - Zhan, Wenwen
AU - Zhang, Qiyu
N1 - This is the peer reviewed version of the following article: BBeekes, W., Brown, P., Zhan, W. and Zhang, Q. (2016), Corporate Governance, Companies’ Disclosure Practices and Market Transparency: A Cross Country Study. Journal of Business Finance & Accounting, 43: 263–297. doi: 10.1111/jbfa.12174 which has been published in final form at http://onlinelibrary.wiley.com/doi/10.1111/jbfa.12174/abstract This article may be used for non-commercial purposes in accordance With Wiley Terms and Conditions for self-archiving.
PY - 2016/3
Y1 - 2016/3
N2 - We examine the link between corporate governance, companies’ disclosure practices and their equity market transparency in a study of more than 5,000 listed companies in 23 countries covering the period 1 January 2003 to 31 December 2008. Our results confirm the belief that better-governed firms make more frequent disclosures to the market. We also find greater disclosure in common law relative to code law countries. However firms with better governance in both code and common law countries make more frequent disclosures. We measure market transparency by the timeliness of prices. In contrast to single country studies, results show, for the 23 countries collectively, better corporate governance is associated with less timely share prices. This would suggest that a firm substitutes better corporate governance for transparency. We are thus led to the conclusion that even if information is disclosed more frequently by better-governed firms, it does not necessarily follow that information is reflected in share prices on a timelier basis.
AB - We examine the link between corporate governance, companies’ disclosure practices and their equity market transparency in a study of more than 5,000 listed companies in 23 countries covering the period 1 January 2003 to 31 December 2008. Our results confirm the belief that better-governed firms make more frequent disclosures to the market. We also find greater disclosure in common law relative to code law countries. However firms with better governance in both code and common law countries make more frequent disclosures. We measure market transparency by the timeliness of prices. In contrast to single country studies, results show, for the 23 countries collectively, better corporate governance is associated with less timely share prices. This would suggest that a firm substitutes better corporate governance for transparency. We are thus led to the conclusion that even if information is disclosed more frequently by better-governed firms, it does not necessarily follow that information is reflected in share prices on a timelier basis.
KW - Corporate Governance
KW - Disclosure Practices
KW - Market Transparency
KW - Legal Origin
KW - Timeliness of Price Discovery
U2 - 10.1111/jbfa.12174
DO - 10.1111/jbfa.12174
M3 - Journal article
VL - 43
SP - 263
EP - 297
JO - Journal of Business Finance and Accounting
JF - Journal of Business Finance and Accounting
SN - 0306-686X
IS - 3-4
ER -