We examine how Regulation FD changed analysts' reliance on firms' public disclosure. Regulation FD is associated with a stronger analyst response to earnings announcements, management forecasts and conference calls—that is, analysts respond to these events more quickly, more frequently and with larger forecast revisions after FD. Further, following public disclosure, the decline in analyst forecast dispersion and forecast error accelerates after FD. We find no such changes either for foreign ADR firms or around several confounding events. Overall, Regulation FD levels the playing field between the analysts and individual investors, thereby promoting “fair game” property of the market.

We examine whether the composition of top management with General Counsel (GC) affects properties of management earnings forecasts disclosures. After controlling for corporate governance and litigation risk, we find that firms with a GC in top management are more likely to issue forecasts, particularly bad news forecasts, than other firms. Further, their forecasts are less optimistic and more accurate than those issued by others. Consistently, the stock price reaction to their forecast news is stronger. These effects are more pronounced when the GC's managerial status is higher. Overall, our results suggest that GCs play an important role in corporate disclosures.