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  • https://doi.org/10.1111/jbfa.12857

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    Available under license: CC BY-NC-ND: Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License

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The Nexus of Corporate Disclosure and Investors’ Information Needs: An Analysis Using Topic Modeling

Research output: Contribution to Journal/Magazine › Journal article › peer-review

E-pub ahead of print

Standard

The Nexus of Corporate Disclosure and Investors’ Information Needs: An Analysis Using Topic Modeling. / Lui, Daphne; Moraru‐Arfire, Andreea; Tao, Cong.
In: Journal of Business Finance and Accounting, 12.02.2025.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Lui, D, Moraru‐Arfire, A & Tao, C 2025, 'The Nexus of Corporate Disclosure and Investors’ Information Needs: An Analysis Using Topic Modeling', Journal of Business Finance and Accounting. https://doi.org/10.1111/jbfa.12857

APA

Lui, D., Moraru‐Arfire, A., & Tao, C. (2025). The Nexus of Corporate Disclosure and Investors’ Information Needs: An Analysis Using Topic Modeling. Journal of Business Finance and Accounting. Advance online publication. https://doi.org/10.1111/jbfa.12857

Vancouver

Lui D, Moraru‐Arfire A, Tao C. The Nexus of Corporate Disclosure and Investors’ Information Needs: An Analysis Using Topic Modeling. Journal of Business Finance and Accounting. 2025 Feb 12. Epub 2025 Feb 12. doi: 10.1111/jbfa.12857

Author

Lui, Daphne ; Moraru‐Arfire, Andreea ; Tao, Cong. / The Nexus of Corporate Disclosure and Investors’ Information Needs : An Analysis Using Topic Modeling. In: Journal of Business Finance and Accounting. 2025.

Bibtex

@article{07c977ee2752401eb7ca6d3cfb3424d5,
title = "The Nexus of Corporate Disclosure and Investors{\textquoteright} Information Needs: An Analysis Using Topic Modeling",
abstract = "This paper identifies thematic topics that individual and institutional investors discuss about firms and investigates whether, and for which type of investors, companies incorporate in their disclosures the investors{\textquoteright} information needs. We use latent Dirichlet allocation to identify firm‐related topics discussed by investors and compare these topics with the content of subsequent firm disclosures. We find a positive association between the proportion of text dedicated to several firm‐related topics discussed by investors and the proportion of text on the same topics in firms{\textquoteright} subsequent MD&A disclosures. We also find that firms integrate much more in their disclosures institutional investors{\textquoteright} information needs, compared with those of individual investors. For a subset of topics, stronger associations occur for more profitable and high‐growth firms, and for firms experiencing more negative sentiment from institutional investors, subject to lower proprietary costs, and utilizing alternative communication channels. Overall, our findings extend the research on the link between individual and institutional investors{\textquoteright} request for information and the content of corporate disclosure.",
keywords = "corporate disclosure, topic modeling, Seeking Alpha, individual investors, institutional investors, financial analysts",
author = "Daphne Lui and Andreea Moraru‐Arfire and Cong Tao",
year = "2025",
month = feb,
day = "12",
doi = "10.1111/jbfa.12857",
language = "English",
journal = "Journal of Business Finance and Accounting",
issn = "0306-686X",
publisher = "Wiley-Blackwell",

}

RIS

TY - JOUR

T1 - The Nexus of Corporate Disclosure and Investors’ Information Needs

T2 - An Analysis Using Topic Modeling

AU - Lui, Daphne

AU - Moraru‐Arfire, Andreea

AU - Tao, Cong

PY - 2025/2/12

Y1 - 2025/2/12

N2 - This paper identifies thematic topics that individual and institutional investors discuss about firms and investigates whether, and for which type of investors, companies incorporate in their disclosures the investors’ information needs. We use latent Dirichlet allocation to identify firm‐related topics discussed by investors and compare these topics with the content of subsequent firm disclosures. We find a positive association between the proportion of text dedicated to several firm‐related topics discussed by investors and the proportion of text on the same topics in firms’ subsequent MD&A disclosures. We also find that firms integrate much more in their disclosures institutional investors’ information needs, compared with those of individual investors. For a subset of topics, stronger associations occur for more profitable and high‐growth firms, and for firms experiencing more negative sentiment from institutional investors, subject to lower proprietary costs, and utilizing alternative communication channels. Overall, our findings extend the research on the link between individual and institutional investors’ request for information and the content of corporate disclosure.

AB - This paper identifies thematic topics that individual and institutional investors discuss about firms and investigates whether, and for which type of investors, companies incorporate in their disclosures the investors’ information needs. We use latent Dirichlet allocation to identify firm‐related topics discussed by investors and compare these topics with the content of subsequent firm disclosures. We find a positive association between the proportion of text dedicated to several firm‐related topics discussed by investors and the proportion of text on the same topics in firms’ subsequent MD&A disclosures. We also find that firms integrate much more in their disclosures institutional investors’ information needs, compared with those of individual investors. For a subset of topics, stronger associations occur for more profitable and high‐growth firms, and for firms experiencing more negative sentiment from institutional investors, subject to lower proprietary costs, and utilizing alternative communication channels. Overall, our findings extend the research on the link between individual and institutional investors’ request for information and the content of corporate disclosure.

KW - corporate disclosure

KW - topic modeling

KW - Seeking Alpha

KW - individual investors

KW - institutional investors

KW - financial analysts

U2 - 10.1111/jbfa.12857

DO - 10.1111/jbfa.12857

M3 - Journal article

JO - Journal of Business Finance and Accounting

JF - Journal of Business Finance and Accounting

SN - 0306-686X

ER -