Kim, Eunjee., Mani Sethuraman, and Thomas Steffen (2021) “The Informational Role of Investor Relations: Evidence from the Debt Market” The Accounting Review 96 (6): 275–302
Abstract: We explore the role of investor relations (IR) in debt markets. Using earnings announcements as a laboratory, we examine whether, when, and to what extent IR departments help credit investors assimilate information. We find that the presence of IR decreases (increases) the negative (positive) impact on CDS spreads stemming from bad (good) earnings news, suggesting that IR efforts improve information precision and reduce transparency risk. Cross-sectional analyses suggest that IR matters more when uncertainty is high and creditors are concerned about the credit-risk implications of firm performance. We also find that IR firms receive higher credit ratings and fewer covenants when issuing bonds, and CDS markets react less negatively when IR firms’ bond ratings are downgraded below investment grade. Because firms choose their IR activities, we show that our inferences are robust to multiple methods of addressing endogeneity. Overall, we find that IR departments are influential in debt markets.
Dyer, Travis and Eunjee Kim (2021) “Anonymous Equity Research” Journal of Accounting Research 59 (2): 575-611
Abstract: Crowdsourced financial information platforms often allow content contributors to publish equity research anonymously. This study examines whether investors value or discount information in anonymous equity research. In the short window around research releases, we find that investors’ stock price reaction to anonymous research is muted in comparison to nonanonymous research. Consistent with credibility concerns influencing investor response, we document that this discount to anonymous research dissipates as the monitoring of content contributors intensifies and as authors develop a reputation for high-quality reporting. In addition, we perform a content analysis on the research reports and find that the muted market reaction to anonymous equity research is robust to controlling for textual attributes of information content, further supporting our inference that investors’ are concerned about the credibility of anonymous equity research.
Kim, Eunjee (2025) “Does Disclosure Regulation Affect Mutual Fund Families’ Proxy Voting?” The Accounting Review
Dissertation
Abstract: Non-activist investors who own more than 5% of a firm are required to report their holdings by filing a 13G in which they must commit to not influencing control of the firm. Mutual fund families are the most prevalent investors filing a 13G. I study whether a 13G affects mutual fund families’ voting behaviors in proxy contests. I find mutual fund families that file a 13G are less likely to vote in favor of activists than are those that do not, suggesting that the 13G requirement discourages mutual fund families to support activists who seek to influence control of the firm. The effects are greater when vote outcomes directly affect the firm’s control and when activists pose a higher threat to the firm. I further document that the aggregate voting power of 13G-filing mutual fund families correlates with management winning a contested vote and retaining board seats during proxy contests.
Kim, Eunjee, Mani Sethuraman, and Shuran Zhang “The Effect of Shared Directors on Firms’ Investor Outreach ”
Revising for the 3rd submission to Journal of Accounting and Economics
Abstract: This paper explores the effect of shared directors on firms’ investor relations (IR) function. Using proxy fights at a target firm as a laboratory, we find that interlocked firms that share one or more directors with the target firm increase investor outreach compared to control firms that do not. The effects are greater when the target firm loses the proxy fight. Moreover, the increase in IR activities is more pronounced for interlocked firms that are held by long-term institutional investors, have fewer antitakeover provisions to combat activism, or exhibit lower pre-existing levels of IR activities. Additionally, we document that the increase in IR activities is concentrated around the time when shared directors need investors’ vote support for retaining board positions at interlocked firms. We also find that this increase is associated with a lower likelihood of proxy fights at interlocked firms. Overall, our findings suggest that firms actively assess the importance of IR and preemptively enhance their IR efforts to prevent shareholder activism.
Eunjee Kim and Hai Pham “Quid Pro Quo? Private Information Flows in Shareholder Activism”
Revising for the 2nd submission to Journal of Accounting Research
Abstract: This paper examines the flow of private information from firms to large-holding shareholders during activist campaigns and its consequences. We find that informed trading by mutual fund families with large holdings in the target firm increases during activist campaigns compared to other mutual fund families invested in the firm. The effect is stronger for firms that attend more invitation-only investor events, face greater threats from activist campaigns, and are harder to value. Consistent with information flowing from management to large-holding mutual fund families, the effect strengthens during periods of lax enforcement of Regulation Fair Disclosure. Furthermore, the increased information advantage is associated with these investor’s management-friendly voting behavior and a higher likelihood of target firms winning activist campaigns and retaining board seats. Overall, our findings suggest a potential quid pro quo relationship between large shareholders’ access to private information and their voting support for management.
Green, Jeremiah, Eunjee Kim, Ben Lourie, and Chenqi Zhu “Paid News Subscription and Market Participation”
Invited to present at the Review of Accounting Studies Conference
Abstract: In the post-paywall era, paid news subscriptions remain rare. Only 4% of randomly selected individuals and 20% of those engaged in investing activity pay for a news subscription. Using granular transaction data that link individuals’ news subscriptions to their transfers with investment accounts, we find that news subscriptions contribute to increased market participation. Within individuals, quarterly net contributions to their portfolios increase by $398 when they pay for news, driven predominantly by social media financial subscriptions rather than traditional financial sources. This association strengthens following a regulatory shock that improves the credibility of social media financial news. Consistent with access to news affecting market participation, subscribing to social media financial news increases investors’ responsiveness to news sentiment. To shed light on the implications of news subscriptions, we focus on cryptocurrency investments and find that social media financial news subscriptions correlate with increased cryptocurrency investment and improved investment performance. Our findings highlight the role of news access in shaping retail investor behavior and inform policy discussions around regulating social financial media .
Kartapanis, Antonis, Eunjee Kim, Kimberlyn Munevar “Alternative Data and Demand for Disclosures”
Green, Jeremiah, John Hand, Eunjee Kim, and Hai Pham “Mutual Funds’ Noise Trading Risk and Corporate Reporting”