COVID-19

Corporate Disclosure

• Peer Effects of Corporate Disclosure in Pandemic Era , with Hyonok Kim and Kazuo Yamada. [SSRN] [MIC WP]
  We show that a peer firm’s management forecast provides information for other firms in the same industry. Specifically, we show that a firm’s management forecast is positively associated with the stock return of other firms in the same industry. Furthermore, we show that such peer effect is observed when peer firms are the first disclosure company in the industry. We also find that the peer effect is more pronounced among firms with higher information asymmetry. Finally, we find that the peer effect is observed only in 2020 and not in other years between 2001 and 2019. Overall, the analysis provides strong evidence of peer effects under the COVID-19 pandemic period. This paper suggests that management forecast of peer firm plays a vital role as useful information set for investors that have limited access to public information due to the global pandemic.

• COVID-19 and Corporate Disclosure in Japan: An early picture, with Kim Hyonok (2020, in Japanese) : Draft available here [MIC WP]

This study investigates how COVID-19 pandemic impacts corporate disclosure in Japan where institutional backgrounds are unique. COVID-19 increased economic uncertainty and decreased human mobility. It also results in deregulation of corporate disclosure regulation. These changes in economic environment are likely to affect corporate disclosure. Using sample with fiscal year end in March 2020, we find several significant changes in corporate disclosure in Japan. First, the days from fiscal year end to earnings announcement has increased indicating declined reporting speed. Second, more than a half of firms did not disclose management forecast which has been effectively mandatory in Japan. Third, managers increased timely disclosure. Forth, geographic distance is an important driver of COVID-19 impact on corporate disclosure. Fifth, analysts and journalists also has decreased their forecast disclosure. These findings suggest that COVID-19 significantly changed information environment of security market.