Abstract
Cai et al. (Rev Account Stud, forthcoming, 2014) find that firms with interlocked directors are more likely to stop quarterly forecasts and that the past stopping experience of interlocked directors affects the forecast-cessation process. Their findings are consistent with the notion that interlocked directors serve as conduits for information sharing, which may result in the change of corporate disclosure policies. My discussion focuses on potential issues with the findings and implications for future study.
Similar content being viewed by others
References
Armstrong, C. S., Guay, W. R., & Weber, J. P. (2010). The role of information and financial reporting in corporate governance and debt contracting. Journal of Accounting and Economics, 50, 179–234.
Beyer, A., Cohen, D. A., Lys, T. Z., & Walther, B. R. (2010). The financial reporting environment: Review of the recent literature. Journal of Accounting and Economics, 50, 296–343.
Bushee, B. J. (1998). The influence of institutional investors on myopic R&D investment behavior. The Accounting Review, 73, 305–333.
Cai, Y., Dhaliwal, D. S., Kim, Y., & Pan, C. (2014). Board interlocks and the diffusion of disclosure policy. Review of Accounting Studies. doi:10.1007/s11142-014-9280-0.
Chen, S., Matsumoto, D., & Rajgopal, S. (2011). Is silence golden? An empirical analysis of firms that stop giving quarterly earnings guidance. Journal of Accounting and Economics, 51, 134–150.
Core, J., & Guay, W. (1999). The use of equity grants to manage optimal equity incentive levels. Journal of Accounting and Economics, 28, 151–184.
Houston, J., Lev, B., & Tucker, J. (2010). To guide or not to guide? Causes and consequences of stopping and subsequently resuming earnings guidance. Contemporary Accounting Research, 27, 143–185.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Zhang, W. Discussion of “Board interlocks and the diffusion of disclosure policy”. Rev Account Stud 19, 1120–1124 (2014). https://doi.org/10.1007/s11142-014-9290-y
Published:
Issue Date:
DOI: https://doi.org/10.1007/s11142-014-9290-y