Nonfinancial Disclosure and Analyst Forecast Accuracy: International Evidence on Corporate Social Responsibility Disclosure
2012/01/01 by Dan S. Dhaliwal, Suresh Radhakrishnan, Albert Tsang +2 · 1,816 citations
Business, Management and Accounting · #Accounting #Affect (linguistics) #Auditing, Earnings Management, Governance #Business #Corporate Finance and Governance #Corporate Social Responsibility Reporting #Corporate social responsibility #Political science #Proxy (statistics) #Public relations #Stakeholder #Transparency (behavior)
paper · doi:10.2308/accr-10218
published in The Accounting Review 87(3), 723-759 (American Accounting Association)
openalex publication_date 2012/01/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/04
Abstract
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.
Citations
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