An International Meeting of the American Accounting Association American Accounting Association 2006 Annual Meeting August 6–9, 2006 Washington, D.C.

Mei - Feng Lin
National Yunlin University of Science & Technology

Chen - Lung Chin
National Chengchi University

Abstract: Public firms in East Asia typically have low levels of transparency and disclosure quality, and the concentration of corporate ownership has created agency conflicts between controlling owners and minority shareholders. Using a sample of listed firms in Taiwan, this paper explores and finds that firms with less divergence between the ultimate owner’s voting rights and the cash flow rights, or the lower percentage of controlling owners’ seats on the board, are more likely to conduct conference calls and conduct them more frequently. Secondly, we hypothesize and find that the negative association between control divergence and conference calls likelihood is more pronounced for firms whose controlling owners use shares as collateral for bank loans. Finally, we predict and find that firms that have at least one shareholder with the standing to sue under Taiwan Corporate Law 214 are more likely to conduct conference calls than other firms.

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