The value relevance of firms’ anti-bribery and corruption efforts the Italian evidence

Abstract

In this paper, we utilized a sample of Italian companies to explore the influence of firms’ Anti-Bribery and Corruption efforts on firm value. On a sample of 47 Italian listed companies followed by Asset4 (Thomson Reuters business collecting corporate social responsibility data) during period 2002 to 2013, we investigate the relevance of information related to firms’ Anti-Bribery and Corruption efforts in explaining stock price through the accounting-based valuation model developed by Ohlson (1995). Results corroborate empirical evidence of a positive correlation between efforts made by firms in avoiding bribery and corruption during operations (i.e., whether a company describes, claims to have or mentions processes in place to avoid Bribery and Corruption practices at all its operations) and stock price.