COVID-19 Risk Factors and Boilerplate Disclosure

38 Pages Posted: 13 Feb 2024 Last revised: 13 May 2024

See all articles by Stephen J. Choi

Stephen J. Choi

New York University School of Law

Mitu Gulati

University of Virginia School of Law

Xuan Liu

New York University School of Law

Adam C. Pritchard

University of Michigan Law School

Date Written: February 19, 2024

Abstract

The SEC mandates that public companies assess new information that changes the risks that they face and disclose these if there has been a “material” change. Does that theory work in practice? Or are companies copying and repeating the same generic disclosures? Using the shock of the COVID-19 pandemic, we explore these questions. Overall, we find considerable rote copying of boilerplate disclosures. Further, the factors that correlate with deviations from the boilerplate seem related more to the resources that companies have (large companies change updated disclosures more) and litigation risks (companies vulnerable to shareholder litigation update more) rather than general economic vulnerability to the pandemic. The exception is companies facing exposure to China.

Suggested Citation

Choi, Stephen J. and Gulati, Mitu and Liu, Xuan and Pritchard, Adam C., COVID-19 Risk Factors and Boilerplate Disclosure (February 19, 2024). Virginia Public Law and Legal Theory Research Paper No. 2024-21, Virginia Law and Economics Research Paper No. 2024-10, U of Michigan Law & Econ Research Paper No. 24-014, NYU Law and Economics Research Paper Forthcoming, Available at SSRN: https://ssrn.com/abstract=4722858 or http://dx.doi.org/10.2139/ssrn.4722858

Stephen J. Choi (Contact Author)

New York University School of Law ( email )

40 Washington Square South
New York, NY 10012-1099
United States

HOME PAGE: http://rb.gy/y6mrqu

Mitu Gulati

University of Virginia School of Law ( email )

580 Massie Road
Charlottesville, VA 22903
United States

Xuan Liu

New York University School of Law ( email )

Adam C. Pritchard

University of Michigan Law School ( email )

625 South State Street
Ann Arbor, MI 48109-1215
United States
734-647-4048 (Phone)
734-647-7349 (Fax)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
138
Abstract Views
518
Rank
385,214
PlumX Metrics