The Role of Financial Information in Supply Chains: Evidence from Electronic Business Registers in Europe

54 Pages Posted: 2 Jul 2024

See all articles by Roberto Vincenzi

Roberto Vincenzi

Bocconi University

Antonio Marra

Bocconi University - Department of Accounting

Ron Shalev

University of Toronto - Rotman School of Management

Vincent Giese

University of Mannheim - Accounting and Taxation; TRR 266 Accounting for Transparency

Date Written: June 28, 2024

Abstract

We explore the importance of firm financial information to the counterparty in supply chain relations. Exploiting the adoption of electronic depositories for financial reports (electronic business registers) in European countries as a shock to the access to private firms' financial information, we find that counterparty financial information asymmetrically affects supply chain parties: customerrelated financial information has a larger impact on suppliers' decisions than supplier-related financial information has on customers' decisions. We also find that the usefulness of customers' financial information to suppliers varies with the scope and reliability of that information. Finally, we find that the effect of the information shock varies with the stages of the supply chain relations: (i) a shock that occurs before the start of supply chain relations contributes to the stability of the relations and (ii) a shock that occurs after relations have started tends to destabilize relations. Overall, our results highlight nuances in the importance of financial information in the supply chain.

Keywords: supply chain relationships, financial information, electronic business registers, financial disclosure regulation

Suggested Citation

Vincenzi, Roberto and Marra, Antonio and Shalev, Ron and Giese, Vincent, The Role of Financial Information in Supply Chains: Evidence from Electronic Business Registers in Europe (June 28, 2024). Available at SSRN: https://ssrn.com/abstract=4879490 or http://dx.doi.org/10.2139/ssrn.4879490

Roberto Vincenzi (Contact Author)

Bocconi University ( email )

Via Sarfatti, 25
Milan, MI 20136
Italy

Antonio Marra

Bocconi University - Department of Accounting ( email )

Via Roentgen 1
Milan, 20136
Italy

Ron Shalev

University of Toronto - Rotman School of Management ( email )

105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada

Vincent Giese

University of Mannheim - Accounting and Taxation ( email )

Mannheim, 68131
Germany

TRR 266 Accounting for Transparency ( email )

Warburger Straße 100
Paderborn, 33098
Germany

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