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The Accounting Review
Bryce Schonberger
Additional Authors: Zackery Fox, Jaewoo Kim
March 2026

Abstract: Exploiting the U.S. shale oil revolution as a substantial, unexpected shock to investment opportunities for oil and gas (O&G) firms, we explore whether firms facing an uncertain investment decision adopt a voluntary disclosure policy that facilitates informational feedback from the equity market. Difference-in-differences tests show O&G firms increase (reduce) their issuance of capital expenditure (earnings) forecasts during the shale oil revolution relative to similar, capital-intensive firms. Consistent with managers using market reactions to proposed investment plans to gather information from informed traders, we find investment expenditures become more sensitive to market reactions to capex forecasts during the shale oil revolution period. Consistent with managerial learning improving investment decisions, we find a more pronounced positive relation between future operating performance and investment adjustments made in response to market reactions for O&G firms during the shale oil boom. Our evidence speaks to how managers tailor disclosures to promote informational feedback from prices.

The Accounting Review
A. Nicole Skinner
Additional Authors: Scott A. Robinson, Jasmine Wang
May 2025

Abstract: We examine how managers’ incentives to minimize litigation risk interact with the unique features of environmental information to shape disclosure decisions. We rely on peer firms’ lawsuits to generate variation in environmental disclosure litigation risk, consistent with prior research and anecdotal evidence suggesting that firms perceive an increase in environmental disclosure litigation risk after a peer firm is sued for related disclosures. Although we provide mixed evidence around changes in total environmental disclosure in response to peer lawsuits, we offer robust evidence that firms provide more forward-looking (and less historical) environmental disclosures in their conference calls in response to peers’ environmental disclosure lawsuits. Our evidence is consistent with firms providing less verifiable disclosures to minimize the risk of being sued for misrepresenting their environmental information.

Journal of Accounting and Economics
Nathan T Marshall
Additional Authors: Eric R Holzman and Brent A Schmidt
February 2024

Abstract: Little is known about how the SEC selects its targets for investigation. We study this subject using a new database of formal SEC investigations. We predict and find that case selection is associated with a firm's (i) likelihood of regulatory noncompliance, (ii) exposure to scrutiny, and (iii) conspicuous public trigger events. The relationship between investigations and regulatory noncompliance and private sector scrutiny preferences is sensitive to SEC constraints, whereas the relationship with triggers is not. We also examine the association between investigation motives and enforcement actions, an important SEC outcome reported to Congress. While regulatory noncompliance-motivated and public trigger-motivated investigations are more likely to result in public charges, specifically when the SEC is constrained, private sector scrutiny-motivated investigations are less likely to result in public charges. Finally, investigation rates of potential targets are associated with the career trajectories of SEC personnel, while investigation outcomes are not.

The Accounting Review
Andrea Pawliczek. A. Nicole Skinner
Additional Author: Heidi A. Packard
October 2023

Abstract: This paper examines voluntary disclosure in the context of shareholder scrutiny of executive compensation contracts. We find that firms voluntarily increase discussion of their performance within their CD&A disclosures when peer-benchmarked compensation relative to performance is high. In contrast, we do not find a similar increase in performance discussion in the corresponding MD&A disclosures, which suggests that the effect is not driven by firms’ general disclosure practices. We also find that the relation between relatively high compensation and CD&A performance disclosure strengthens following the implementation of mandatory Say-on-Pay, which increased costs associated with investor criticism of pay. These disclosures appear to be used effectively to avoid negative compensation assessments, in that they are associated with higher levels of shareholder and proxy advisor approval. Altogether, our findings suggest that CD&A performance disclosures allow firms to communicate the context of their compensation choices to improve shareholder opinions of pay.

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