Do better governed firms make more informative disclosures? Canadian evidence

Using a Canadian sample, we address Beekes and Brown’s (2005) external validity concerns by replicating their result that corporate governance influences the timeliness and informativeness of corporate disclosures. Based largely on their approach, we find Canadian firms with better governance structures release more documents to the share market, and share prices integrate information more rapidly. These firms also attract a larger following of analysts, who make forecasts that are less biased. However, three other predictions concerning analyst forecasts are not borne out. We interpret our results as, on the whole, confirming the Beekes and Brown conclusion that corporate governance standards can play a significant role in determining the efficiency of a country’s equity market