Does Independent Directors' Participation Matter in Interactive Information Exchange? Evidence from Earnings Communication Conferences in China*

Abstract The study examines how independent directors’ (IDs’) participation in earnings communication conferences (ECCs) influences the quality of investor‐management interactions. Using question‐and‐answer transcripts from Chinese ECCs, we construct a multidimensional measure of interaction quality that incorporates semantic relevance (via Sentence‐BERT embeddings), response readability, and information content. We find that IDs' participation significantly enhances interaction quality. Mechanism analyses suggest that this effect operates through diligence signaling, real‐time oversight, and reputational incentives. The enhancement is more pronounced when IDs are female, younger, have longer tenure, or hold fewer concurrent directorships. Moreover, the marginal benefit is greater when multiple IDs attend the ECC. Finally, we show that IDs' participation amplifies the positive capital market reaction to high‐quality interactions. These findings highlight the critical role of IDs in promoting effective interactive information exchange.

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Publication Details

Journal
Asia-Pacific Journal of Financial Studies
Published
2026-01-07
DOI
https://doi.org/10.1111/ajfs.70033
Primary Topic
Auditing, Earnings Management, Governance
Type
article
Field-Weighted Citation Impact
0.00
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article

Does Independent Directors' Participation Matter in Interactive Information Exchange? Evidence from Earnings Communication Conferences in China*

Yong Ye, Jingxin Li
Asia-Pacific Journal of Financial Studies
Auditing, Earnings Management, Governance
article

Does Independent Directors' Participation Matter in Interactive Information Exchange? Evidence from Earnings Communication Conferences in China*

Yong Ye, Jingxin Li
article en

Abstract

Abstract The study examines how independent directors’ (IDs’) participation in earnings communication conferences (ECCs) influences the quality of investor‐management interactions. Using question‐and‐answer transcripts from Chinese ECCs, we construct a multidimensional measure of interaction quality that incorporates semantic relevance (via Sentence‐BERT embeddings), response readability, and information content. We find that IDs' participation significantly enhances interaction quality. Mechanism analyses suggest that this effect operates through diligence signaling, real‐time oversight, and reputational incentives. The enhancement is more pronounced when IDs are female, younger, have longer tenure, or hold fewer concurrent directorships. Moreover, the marginal benefit is greater when multiple IDs attend the ECC. Finally, we show that IDs' participation amplifies the positive capital market reaction to high‐quality interactions. These findings highlight the critical role of IDs in promoting effective interactive information exchange.

Asia-Pacific Journal of Financial Studies
Southwest Jiaotong University (CN)
Openalex Percentile: Top 95%
Auditing, Earnings Management, Governance
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