The effect of corporate annual report quality on the relationship between institutional blockholder monitoring and firm's information environment

초록

Expanding on current research, this study finds that firms with better financial report readability demonstrate a stronger relationship between institutional blockholder monitoring and information asymmetry. This result supports our hypothesis that enhanced readability improves firm information and aids the institutional investor monitoring of firms, reducing information asymmetry. By demonstrating that readability amplifies the marginal effect of institutional blockholder monitoring, we highlight the significance and policy implications of better corporate disclosure readability. © 2023 International Review of Finance Ltd.

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