Information Disclosure Transformation in the Digital Economy: The Role of Digital Infrastructure in Visual Disclosure

ABSTRACT We investigate how digital infrastructure development affects corporate visual disclosure, distinguishing between discretionary image‐based formats and structured table‐based formats. Using data on Chinese A‐share‐listed firms from 2009 to 2022, we find that improvements in digital infrastructure are associated with greater use of image‐based visual disclosure in annual reports, whereas we detect no statistically significant association with table‐based visual disclosure. Mechanism analyses show that this relationship is driven by both supply‐side enhancements in firms' organizational capabilities and demand‐side incentives to cater to external users' information‐processing demands, as evidenced by stronger effects among firms with more extensive explicit discussions of digital transformation in their MD&A and higher institutional ownership. We also find that this effect is more pronounced in regions with higher levels of AI computing power development, as well as among firms with a lower propensity for earnings manipulation and fewer financing constraints. This paper expands the theoretical framework for understanding changes in corporate disclosure formats in the digital economy and offers implications for policymakers, investors and firms.