A Study of Industry Information Disclosure on Corporate Debt Financing Costs

Industry-specific information disclosure, guided by investor demand, seeks to enhance information disclosure quality by refining industry-specific disclosure standards. Its effect on external investor risk perception and, consequently, the reduction of corporate debt financing costs is a crucial issue that needs to explore. Using a natural experiment based on the cross-listing of industry-specific information disclosure guidelines by the Shanghai and Shenzhen Stock Exchanges, this study analyzes the impact and mechanisms of industry-specific information disclosure on corporate debt financing costs, utilizing a sample of Chinese A-share listed companies from 2011 to 2020. The findings reveal that industry-specific information disclosure significantly reduces corporate debt financing costs. Furthermore, when considering market competition and business complexity, it is observed that increased market competition and business complexity enhance the positive effect of industry-specific information disclosure in reducing debt financing costs. Mechanism analysis suggests that industry-specific information disclosure primarily reduces corporate debt financing costs by mitigating information risk and operational risk. The conclusions of this study offer important policy implications for optimizing industry-specific operational information disclosure, reducing external investor risk perception, and subsequently lowering corporate debt financing costs.