Internationalization and risk disclosure in Brazil’s largest public companies
DOI:
https://doi.org/10.18568/internext.v20i1.763Keywords:
Internationalization of companies, Disclosure, Non-financial riskAbstract
Objective: Investigate the disclosure of non-financial risks based on the internationalization profile of the largest public companies in Brazil. Method: The study evaluates internationalization in strategies — capital, shares on the stock exchange, revenues and markets — and the disclosure of non-financial risks based on 31 factors distributed in four categories: operational, damage, integrity and strategic. One hundred and eleven firms listed in Exame Magazine's “Best and Biggest” were analyzed, with data from the 2017–2019 three-year period, using the Mann-Whitney test in comparative evaluation according to internationalization. Main Results: Internationalized companies adopt varied strategies. Risk disclosure had an average of less than 35% and little variation. These companies have an advantage in disclosing risks due to more robust disclosure practices. There are significant differences in the quality of risk disclosure compared to companies according to their internationalization strategy. The analysis of the relationship between the variables suggests that the internationalization of capital can impact risk disclosure.
Relevance / Originality: This research focuses on the quality of disclosed risk factors and analyzes the differences in the reporting of non-financial risks between internationalized and non-internationalized companies, an approach that has not yet been investigated in a similar way in the Brazilian capital market, given its complexity and scope. Theoretical / Methodological Contributions: Measuring internationalization under various strategies makes it possible to understand how it drives business. The analysis of risk disclosure from different perspectives makes it possible to analytically understand the quality of risk disclosure in the company's activities abroad. Social / Management Contributions: Managers can understand how internationalization can be used as a strategic driver of practices associated with risk management and disclosure by the largest companies, for example, reducing information asymmetry and increasing the confidence of investors and other stakeholders.
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