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Financial disclosure by SMEs listed on a semi-regulated market: evidence from the Euronext Free Market

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  • Andy Lardon
  • Marc Deloof

Abstract

This study investigates the financial disclosure policy of small and medium-sized enterprises listed on a stock market with very low disclosure requirements: the Free Market of the Euronext Stock Exchange. In contrast to firms listed on a regulated stock market, firms on the Free Market do not have any obligation to disclose periodic or price-sensitive information. We investigate the determinants of voluntary financial disclosure and its influence on stock liquidity. Our results suggest that firms disclose more financial information when they are likely to benefit from disclosure. Firms especially disclose when they issue equity. Voluntary disclosure also has a significant positive effect on stock liquidity, consistent with disclosure reducing information asymmetry. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Andy Lardon & Marc Deloof, 2014. "Financial disclosure by SMEs listed on a semi-regulated market: evidence from the Euronext Free Market," Small Business Economics, Springer, vol. 42(2), pages 361-385, February.
    • Handle: RePEc:kap:sbusec:v:42:y:2014:i:2:p:361-385
    DOI: 10.1007/s11187-013-9484-x
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    More about this item

    Keywords

    Financial disclosure; Financial disclosure regulation; SMEs; Stock liquidity; Euronext Free Market; L26;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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