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Do Corporate Governance Analysts Matter? Evidence from the Expansion of Governance Analyst Coverage

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  • NICO LEHMANN

Abstract

This paper examines the economic consequences of the initiation of governance analyst coverage. Governance analysts process, enhance, and disseminate governance‐related information to capital market participants via, for example, governance reports and ratings. Using an exogenous shock in the United Kingdom, I find that an increase in governance analyst coverage results in increased governance quality, improved liquidity, increased financial analyst following, and improved investor breadth. These findings are consistent with governance analysts creating value for firms via monitoring, information dissemination/production, and investor recognition.

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  • Nico Lehmann, 2019. "Do Corporate Governance Analysts Matter? Evidence from the Expansion of Governance Analyst Coverage," Journal of Accounting Research, Wiley Blackwell, vol. 57(3), pages 721-761, June.
    • Handle: RePEc:bla:joares:v:57:y:2019:i:3:p:721-761
    DOI: 10.1111/1475-679X.12254
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    6. Huang, Peng & Lu, Yue & Wee, Marvin, 2020. "Corporate governance analysts and firm value: Australian evidence," Pacific-Basin Finance Journal, Elsevier, vol. 63(C).
    7. Blankespoor, Elizabeth & deHaan, Ed & Marinovic, Iván, 2020. "Disclosure processing costs, investors’ information choice, and equity market outcomes: A review," Journal of Accounting and Economics, Elsevier, vol. 70(2).
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    9. Ya-Fang Wang & Yu-Chu Hsieh, 2023. "Credit Rating and Board Evaluation of Family Firms," International Journal of Business and Economic Sciences Applied Research (IJBESAR), International Hellenic University (IHU), Kavala Campus, Greece (formerly Eastern Macedonia and Thrace Institute of Technology - EMaTTech), vol. 16(1), pages 7-18, October.
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