Nonfinancial Disclosure and Analyst Forecast Accuracy: International Evidence on Corporate Social Responsibility Disclosure

2011 ◽  
Author(s):  
Dan S. Dhaliwal ◽  
Suresh Radhakrishnan ◽  
Albert Tsang ◽  
Yong George Yang
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Forecast Accuracy ◽  
Analyst Forecast ◽  
International Evidence ◽  
Corporate Social Responsibility Disclosure ◽  
Corporate Social ◽  
Nonfinancial Disclosure

Nonfinancial Disclosure and Analyst Forecast Accuracy: International Evidence on Corporate Social Responsibility Disclosure

2012 ◽  
Vol 87 (3) ◽  
pp. 723-759 ◽  
Author(s):  
Dan S. Dhaliwal ◽  
Suresh Radhakrishnan ◽  
Albert Tsang ◽  
Yong George Yang
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Forecast Accuracy ◽  
Data Availability ◽  
Financial Disclosure ◽  
Analyst Forecast ◽  
Nonfinancial Information ◽  
Firm Financial Performance ◽  
Corporate Social ◽  
The Relationship

ABSTRACT We examine the relationship between disclosure of nonfinancial information and analyst forecast accuracy using firm-level data from 31 countries. We use the issuance of stand-alone corporate social responsibility (CSR) reports to proxy for disclosure of nonfinancial information. We find that the issuance of stand-alone CSR reports is associated with lower analyst forecast error. This relationship is stronger in countries that are more stakeholder-oriented—i.e., in countries where CSR performance is more likely to affect firm financial performance. The relationship is also stronger for firms and countries with more opaque financial disclosure, suggesting that issuance of stand-alone CSR reports plays a role complementary to financial disclosure. These results hold after we control for various factors related to firm financial transparency and other potentially confounding institutional factors. Collectively, our findings have important implications for academics and practitioners in understanding the function of CSR disclosure in financial markets. Data Availability: The data are publicly available from the sources identified in the paper.

Sign in / Sign up

Export Citation Format

Share Document