MANAGEMENT DECISIONS REGARDING THE VOLUNTARY DISCLOSURE OF INFORMATION: THE PROBLEM OF THE RECOGNITION OF THE FIRM’S INTELLECTUAL CAPITAL AND THAT OF LENDERS’ INFORMATION NEEDS

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Abstract

We analyse data on Italian listed companies quoted on the Milan stock exchange which perform R&D (Research & Development) activity. We find there is a positive relationship between R&D activity and voluntary disclosures of additional information that: a) regards R&D assets in themselves, in line with theoretical predictions according to which voluntary disclosure makes up for shortcomings in the current financial accounting model; b) is relevant to lenders’ interests, in line with the fact that quoted Italian firms are highly dependent upon lenders. Owner-managers of quoted Italian firms show, moreover, a significant tendency to augment additional information provided to lenders in the event of losses (negative earnings).

Keywords: Controlling Shareholders, Lenders, Minority Shareholders, Intellectual Capital Information

How to cite this paper: Napoli, F. (2014). Management decisions regarding the voluntary disclosure of information: the problem of the recognition of the firm’s intellectual capital and that of lenders’ information needs. Corporate Ownership & Control, 11(2-2), 251-263. https://doi.org/10.22495/cocv11i2c2p1