They say that too much of anything is a bad idea. Now two academics have tried to determine whether the same applies to corporate disclosure, too.
The pair, Benjamin Hermalin at the University of California, Berkeley, and Michael Weisbach of Ohio State University, say the answer is yes. While disclosure is seen as a good thing in the eyes of investors and public-interest groups, too much disclosure—and they haven't pinpointed how much is “too much”—can skew executive compensation upward and warp executives' decisions about strategic business investments.
“One needs to ask the question of what market failures these regulations are correcting,” ...