Disclosure, Oversight, and the Information Environment

Abstract

This dissertation examines how institutional mechanisms -- political, regulatory, and market-based -- shape the information environments of firms and the resulting consequences for enforcement, investment, and firm behavior. In the first chapter, I study the role of congressional investigations in detecting corporate misconduct. Using data on all U.S.\ congressional hearings from 2002 to 2020, I find that investigated firms experience increased regulatory violations within two years of testimony, with higher number of violations for hearings that produce more information and attract greater media coverage. Enforcement responses extend beyond the focal issues raised in testimony to unrelated violation categories, suggesting that congressional oversight broadens regulatory scrutiny beyond traditional enforcement channels. In the second chapter, I examine variable leases under the new lease accounting standard (ASC 842), which allows these arrangements to remain off balance sheet. I find that variable lease expenses are prevalent, persistent, and predictable, and firms increasingly substitute operating leases with variable leases following adoption, lowering reported liabilities without altering underlying economic obligations. Neither equity betas nor credit ratings reflect potential variable lease liabilities, and conservative estimates show that recognition would increase reported debt on average. In the third chapter, I study how media coverage functions as an information production mechanism in venture capital markets, where formal disclosure is infrequent and voluntary. I find that VC investment is associated with significant increases in media coverage, with coverage being higher when investors hold board seats and weaker for high-reputation VCs, consistent with media visibility substituting for reputational capital. Post-investment media coverage is associated with a higher likelihood of subsequent financing and improved employee quality, suggesting that investors actively shape the information environment of opaque private markets.