Ownership Structure, Voluntary RD Disclosure and Market Value of firms：the french case.pdf

INTERNATIONAL JOURNAL OF BUSINESS, 17(2), 2012 ISSN : 1083-4346 Ownership Structure, Voluntary RD Disclosure and Market Value of Firms: The French Case Mehdi Nekhili, Sabri Boubaker\ Faten Lakhal Université de Reims Champagne-Ardenne - Rouen Business School, France mehdi. nekhili@univ-reims.fr * Groupe ESC Troyes - IRG, Université Paris Est Créteil, France sabri. boubaker@groupe-esc-troyes. com ^Institut Supérieur de Gestion de Sousse, Tunisie - IRG, Université Paris Est Créteil, France faten. lakhal@u-pec.fr ABSTRACT RD disclosure is a strategic decision directed at investors. However, voluntary RD disclosure can lead to a higher proprietary cost and may benefit competitors. The main purpose of the present paper is to examine whether voluntary RD disclosure impacts the firms market value, and whether it is influenced by ownership structure. Using a sample of 84 French listed firms over the 2000-2004 period, we develop an RD disclosure index composed of 32 hand-collected items from annual reports. The obtained findings provide some important insights. First, we show that voluntary RD disclosure improves the market value of equity, suggesting that the benefits from disclosures of RD activities exceed the disclosure costs. Second, we find that family- and institutional investor-firms are more prone to retain RD information. Finally, we document that the more French firms invest in RD, the larger the amount of RD-related information they disclose. Also, RD capitalization provides incentives for companies to disseminate more RD-related informat