Extent and determinants of voluntary disclosure for regulatory purposes in the Italian airport industry

In addition to enhancing financial markets and corporate governance effectiveness, voluntary disclosure can serve the purpose of regulation through the balancing of powers among the actors of the market. Lack of transparency has been viewed as one of the main barriers to the effectiveness of traditional ex-ante regulation frames in regulated markets and, in particular, as a potential threat in relation to the general rethinking of airport regulation approach based on the pillars of free negotiation, periodical consultation between stakeholders and monitoring activity by an independent authority. The central theme is whether airports, as significant examples of regulated monopolies and in contexts where regulation is changing, such as Europe with Directive 2009/12/CE, are liable to voluntarily offer stakeholders information they had to give, as mandatory requirements, to regulatory authority. Transparency, in fact, becomes a powerful tool to increase the effectiveness of regulation and disclosure level should be adequately considered by governments to assess the maturity of regulated industries and so identify the best way to implement non-formal regulation systems. This study examines the extent and the determinants of voluntary disclosure by Italian airports. The key findings are that disclosure behaviour related to regulatory purposes is moderate and quite similar as regards financial and general information and that financial disclosure is influenced by the form of concession and the origin of traffic, while the general disclosure is impacted by the number of passengers and the form of concession. The findings provide airport managers with the awareness about the unsystematic nature of disclosure practices and contribute to sensitize them on the necessity to abandon compliance-driven approach, as a higher level of voluntary disclosure could be an important way to reinforce airport competitiveness. Major practical implications are also related to the evolution of the approach to regulation in the international context. In this regard, the central takeaways from the results imply that specific policies should be developed to enhance and constantly monitor the level of disclosure in regulated industries, and that the implementation of an indistinct ex-post regulation model for all company categories is highly risky for improving market efficiency, as structural and operational features of companies should be considered in advance.