Sequential questioning and structured responses: Enhancing the information effectiveness of corporate site visits

Abstract

The Question and Answer (Q&A) session between institutional investors and management, as a vital component of corporate site visits (CSVs), plays a crucial role in the efficiency and quality of information transmission. Thus, in this study, we focus on the methods in which investors ask questions and the response patterns of management in the CSV Q&A session to explore the impact of these factors on cumulative abnormal returns (CARs) after CSV. The empirical results indicate that CSVs in which investors employ a strategy of sequential questioning, management provides structured responses, or both generate higher CARs following the event than other types of CSVs do. Further mechanism analysis indicates that the mechanism of action of this positive impact is the effective alleviation of information asymmetry by these CSVs. In addition, we find that this positive impact is pronounced during market downturns and when stakeholder investors participate in the CSV.