Customer Information Disclosure and Corporate Financing Constraints

44 Pages Posted: 23 Feb 2023

See all articles by Xin Wang

Xin Wang

affiliation not provided to SSRN

Yuan George Shan

The University of Western Australia - UWA Business School

Jianbo Song

Renmin University of China

Abstract

We examine the impact of voluntary customer information disclosure by Chinese-listed companies on their financing constraints from the perspective of information transparency. The results show that voluntary disclosure can alleviate financing constraints, and the effect is pronounced when detailed customer information is disclosed. Analyst following and information opacity are used as a proxy for information transparency to test the mediating effect, and it is found that voluntary disclosure reduces financing constraints by increasing information transparency. In addition, the results indicate that when industry competition is fierce and the quality of internal control is low, disclosure of customer information has a more pronounced effect on the alleviation of financing constraints. Policymakers and corporate decision-makers should be aware that voluntary customer information has great significance for the improvement of information environment in China’s capital market.

Keywords: Customer information disclosure, information asymmetry, signaling, financing constraints, information environment

Suggested Citation

Wang, Xin and Shan, Yuan George and Song, Jianbo, Customer Information Disclosure and Corporate Financing Constraints. Available at SSRN: https://ssrn.com/abstract=4368347 or http://dx.doi.org/10.2139/ssrn.4368347

Xin Wang

affiliation not provided to SSRN ( email )

No Address Available

Yuan George Shan (Contact Author)

The University of Western Australia - UWA Business School ( email )

Crawley, Western Australia 6009
Australia

Jianbo Song

Renmin University of China ( email )

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