Enhancing bank transparency: Financial reporting quality, fraudulent peers and social capital

Marco Maria Mattei, P. Platikanova

Producció científica: Article en revista indexadaArticleAvaluat per experts

Resum

This study examines the role of social norms in financial markets by relating bank transparency to social capital. Using comprehensive data on commercial banks, we provide empirical evidence that high social capital contributes to more transparent financial reporting, thereby enabling more precise risk assessments and promoting financial stability. We find that the effect of social capital is more pronounced when commercial banks are more complex and disclosure incentives of bank managers are strong. Our results suggest that more opaque reporting by peers explains lower transparency but financial misreporting is less contagious when social capital is high. Our study suggests that social capital can effectively improve reporting transparency when other mechanisms are not effective, thus securing financial system stability.

Idioma originalAnglès
Pàgines (de-a)3419-3454
Nombre de pàgines36
RevistaAccounting and Finance
Volum63
Número3
DOIs
Estat de la publicacióPublicada - de set. 2023

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