Enterprise cultural environment, analyst coverage and information disclosure violations

Corporate violations vary with the specific institutional environment and are shaped by corporate values, culture, and institutional context. As an informal institution with far-reaching influence, enterprise cultural environment—encompassing corporate values, spirit, ethics, humanistic care, and related factors—offers a new perspective for examining the institutional drivers behind accounting irregularities. Consequently, enterprise cultural environment has drawn increasing scholarly attention in investigating corporate misconduct. In this paper, we employ the Enterprise Cultural Environment Index, provided by the Investor Protection Research Centre at Beijing Technology and Business University, to measure the enterprise cultural environment. Our findings reveal a significantly negative relationship between enterprise cultural environment and the occurrence of accounting irregularities, indicating that a strong enterprise cultural environment effectively curtails such misconduct. Moreover, our results suggest that analyst coverage strengthens this negative relationship, further amplifying the constraining effect of enterprise cultural environment on accounting irregularities.