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Outperforming markets: IC and the long-term performance of Japanese IPOs

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  • Christian Nielsen
  • Gunnar Rimmel
  • Tadanori Yosano

Abstract

This article studies the effects of disclosure practices of Japanese IPO prospectuses on long-term stock performance and bid–ask spread, as a proxy for cost of capital, after a company is admitted to the stock exchange. A disclosure index methodology is applied to 120 IPO prospectuses from 2003. Intellectual capital information leads to significantly better long-term performance against a reference portfolio, and is thus important to the capital market. Further, superior disclosure of IC reduces bid–ask spread in the long-term, indicating that such disclosures are important in an IPO setting. Analysts and investors can attain higher long-term returns by understanding IC.

Suggested Citation

  • Christian Nielsen & Gunnar Rimmel & Tadanori Yosano, 2015. "Outperforming markets: IC and the long-term performance of Japanese IPOs," Accounting Forum, Taylor & Francis Journals, vol. 39(2), pages 83-96, June.
    • Handle: RePEc:taf:accfor:v:39:y:2015:i:2:p:83-96
    DOI: 10.1016/j.accfor.2015.04.001
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    2. Robert Rieg & Ute Vanini, 2023. "Value relevance of voluntary intellectual capital disclosure: a meta-analysis," Review of Managerial Science, Springer, vol. 17(7), pages 2587-2631, October.

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