Raf Orens

Intellectual capital disclosure, cost of finance and firm value

Purpose – The purpose of this paper is to examine empirically the impact of web‐based intellectual capital (IC) reporting on firms value and its cost of finance.Design/methodology/approach – A content‐analysis of corporate web sites is conducted from four continental European countries (Belgium, France, Germany and The Netherlands) on the presence of IC information. Simultaneous regression modelling is used to control for endogeneity within a firms disclosure strategy.Findings – The data show that cross‐sectional differences in the extent of IC disclosure are positively associated with firm value. Greater IC disclosure in continental Europe is associated with lower information asymmetry, lower implied cost of equity capital and lower rate of interest paid.Research limitations/implications – The study is restricted to an analysis of firms benefits of increased web‐based disclosure without considering related costs.Practical implications – The results of the study show that firms tend to benefit economic...

Determinants of Sell-Side Financial Analysts' Use of Non-Financial Information

Abstract This paper aims to research the context within which sell‐side financial analysts make decisions to use corporate non‐financial information. Prior research has demonstrated that financial analysts take into account non‐financial information in their analyses of firms, but knowledge is scarce about what determines their use of this information. Based on a survey conducted among Belgian financial analysts, we observe a significant negative association between the financial analysts’ use of non‐financial information and the earnings informativeness of a firms financial statement information proxied by leverage and stock return volatility. We also find that a higher amount of non‐financial information is used by less experienced financial analysts and by financial analysts covering a higher number of firms.

Management Control Systems In Family Firms: A Review Of The Literature And Directions For The Future

Family firms play a significant role in the global economy. Although family firm literature has devoted much time and effort to investigating topics concerning corporate governance, leadership, ownership and succession, accounting issues have received relatively scant attention. In this paper, we assemble and critically review extant literature on the choice of management controls. This is an essential topic for firms as management control systems (MCS) are used to make sure subordinates behave in function of the goals of the firm. Family firms, however, have distinct features, such as differences in governance structures and goals, which can have a significant impact on whether and how MCS are used. We conclude this review paper by providing avenues for future research that can advance our understanding of both the determinants and the outcomes of the choice of MCS.