The Spillover of Shareholder Litigation Risk and Corporate Voluntary Disclosure
研究发现，当同行企业面临诉讼风险时，目标企业会预期到风险溢出，从而主动减少自愿性信息披露，包括降低管理层盈利预测的发布可能性和频率。
In this study, we instigate whether firms proactively change their voluntary disclosure in anticipation of the spillover of their peer firms’ litigation risk. We find that focal firms facing greater ex ante spillover litigation risk reduce disclosure activities by lowering both the likelihood of issuance and the frequency of management earnings forecasts. We then show that the effect is robust and unlikely driven by some omitted correlated variables using an alternative ex ante litigation risk measure that is not related to firm characteristics. We further demonstrate that the effect is likely causal using a difference-in-differences design where an unanticipated court ruling significantly reduces certain firms’ exposure to peers’ litigation risk spillover. The results from cross-sectional analyses are also consistent with ex ante litigation risk driving the negative relation.