Research seminar - Financial Markets and Regulations

This study investigates whether firms design their voluntary disclosures to satisfy theinformation demands of public credit market investors. With the aim of identifying a plausiblyexogenous change to bond investors’ demand for financial information, I rely on the European Central Bank’s introduction of an unconventional monetary policy tool, the Corporate Sector Purchase Program, through which the ECB conducted significant purchases of corporate bonds irrespective of firms’ disclosure environments. I find that firms eligible for this monetary program abridge credit-specific disclosures related to cash flows and liabilities. I find noevidence, however, that firms alter their equity-oriented disclosures. Combined evidence indicates that managers adapt their voluntary disclosures to the specific information needs of various classes of investors, including those in the public debt market. This paper presents novel insights into an unexplored set of firms’ credit-relevant disclosures. Moreover, it demonstrates the nontrivial effects of monetary policy on firms’ information environments.

The seminar will be hel both in presence and online