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Delegation of management authority and the level of corporate risk disclosure

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  • Sun, Shuangcheng
  • Xiao, Xiaoyan

Abstract

This study reveals that delegating more power to management tends to decrease corporate risk information disclosure. The detrimental effects of this power delegation are especially significant in companies within less marketized regions and those distanced from regulatory supervision. These findings highlight the critical role of external regulators in cultivating a robust market and legal framework. Such an environment is key to developing effective corporate charter systems that can restrain management's self-interest and ensure more transparent risk disclosure.

Suggested Citation

  • Sun, Shuangcheng & Xiao, Xiaoyan, 2024. "Delegation of management authority and the level of corporate risk disclosure," Finance Research Letters, Elsevier, vol. 63(C).
    • Handle: RePEc:eee:finlet:v:63:y:2024:i:c:s1544612324003143
    DOI: 10.1016/j.frl.2024.105284
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    References listed on IDEAS

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    1. Shabir, Mohsin & Jiang, Ping & Shahab, Yasir & Wang, Peng, 2023. "Geopolitical, economic uncertainty and bank risk: Do CEO power and board strength matter?," International Review of Financial Analysis, Elsevier, vol. 87(C).
    2. Kaouthar Lajili, 2009. "Corporate Risk Disclosure and Corporate Governance," JRFM, MDPI, vol. 2(1), pages 1-24, December.
    3. Bingler, Julia Anna & Kraus, Mathias & Leippold, Markus & Webersinke, Nicolas, 2022. "Cheap talk and cherry-picking: What ClimateBert has to say on corporate climate risk disclosures," Finance Research Letters, Elsevier, vol. 47(PB).
    4. Ibrahim, Awad Elsayed Awad & Hussainey, Khaled & Nawaz, Tasawar & Ntim, Collins & Elamer, Ahmed, 2022. "A systematic literature review on risk disclosure research: State-of-the-art and future research agenda," International Review of Financial Analysis, Elsevier, vol. 82(C).
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    Cited by:

    1. Li, Fangfang & Yao, Yuan & Lu, Pu & Li, Yan, 2025. "Risk disclosure and company valuation: Moderating effect of regulation," Finance Research Letters, Elsevier, vol. 82(C).

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