Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 6, 2022 erstellt
Beschreibung:
Audit committee (AC) disclosures are important for stakeholders seeking to evaluate and hold ACs accountable. Despite a wave of heightened attention in the past decade, disclosure changes have tapered off in recent years and are slow to incorporate the AC’s expanding set of oversight responsibilities. To make sense of these decelerating AC disclosure trends at a time when other proxy disclosures are improving, we use semi-structured interviews with 30 AC members, 5 general counsels, and 14 members of the investor community to learn how companies decide what information to disclose about AC oversight and whether these disclosures meet stakeholder needs. Using theories related to signaling and isomorphism, we find that the current disclosure process has created a focus on standardized language following existing norms rather than signaling quality by “telling the story” of the AC. Signaling theory allows us to identify the key breakdown in the disclosure cycle: companies do not receive feedback about the usefulness of AC disclosures from investors. This environment leads to companies feeling like investors are satisfied with current disclosures while investors are left feeling frustrated that companies provide so little information about the AC. Our findings and suggestions for moving forward should be of interest to academics as well as preparers, users, and regulators of governance disclosures