Shaping Corporate Actions Through Targeted Transparency Regulation: A Framework and Review of Extant Evidence
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This paper discusses targeted transparency regulation by securities regulators: corporate disclosure regulation aimed at nudging firms towards changing their business activities in socially desirable ways. Using Corporate Social Responsibility disclosures and other prominent examples, we first document disclosure regulators’ public policy objectives. Based on a framework that develops the causal chain linking a disclosure mandate to the desired corporate action, we review empirical evidence on the effectiveness of targeted transparency implemented via securities regulation. The paper concludes with a discussion of opportunities and challenges for future research in this area.
KeywordsDisclosure Transparency Public policy CSR Real effects
JEL classificationM14 M48 Q38 Q56
We thank Tanja Zohner, two anonymous reviewers and Alfred Wagenhofer (the editor) for valuable comments. Alexander Paulus provided excellent research assistance.
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