What is Corporate Disclosure?

What is Corporate Disclosure?

Marko Vujosevic

What is Corporate Disclosure?

Disclosure involves publicizing facts or information and making it known to the public. Corporate disclosure is the process by which companies make investors, customers, and any other individuals or organizations doing business with the company aware of pertinent information.

In the corporate world, disclosures are essential for public trust, and are an important, informative part of investing or doing business with a company.

Companies issue disclosures to investment analysts and investors, providing them with information that could sway their decision whether to buy the company’s stock or bonds. Disclosure statements can relay positive or negative financial information and news about the company.

Investment research reports disclose the nature of relationships between the equity analyst, their employer, and the subject company, as well as bringing to the investors’ attention critical facts about the company

Just as footnotes are a vital part of a corporate financial report, so disclosures are important to research reports.

Investment research reports disclose the nature of relationships between the equity analyst, their employer, and the subject company, as well as bringing to the investors’ attention critical facts about the company. In the US, the Securities and Exchange Commission stipulates that a disclosure statement must be incorporated in all research reports, advising that research reports that lack a disclosure statement should be disregarded, as they are untrustworthy.

Just as footnotes are a vital part of a corporate financial report, so disclosures are important to research reports. Like footnotes, disclosures generally appear at the end of the research report in fine print. They are written by lawyers and tend to be quite lengthy.

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