Journal of Accounting and Economics Vol. 71 No. 1 2021
Investor communication and the benefits of cross-listing
Abstract
While studies have sought to explain the benefits of cross-listing, little attention has been paid to the role of communication between managers and investors during this process. In this paper, I investigate whether managers change communication policies around U.S. cross-listings. I document significant increases in communication when firms cross-list. I then test whether these investor communication practices around cross-listing are associated with capital market benefits. I find that cross-listed firms that communicate more with investors experience greater and longer lasting cross-listing benefits. Lastly, I explore two potential reasons that may lead managers to choose higher levels of communication: to support an increase in investor recognition and to facilitate monitoring. I find results consistent with communication increasing visibility and scrutiny, suggesting that communication functions as a supporting tool to achieve managers’ cross-listing goals.
- DOI
- 10.1016/j.jacceco.2020.101356
- Volume
- 71
- Issue
- 1
- Pages
- 101356
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref