Societal Information Disclosure and the Cost of Equity: the Case of Tunisian Companies
The purpose of this article is to identify the determinants of social and environmental disclosure and its relationship with the cost of equity. The sample used is composed of 36 Tunisian listed companies over the period 2001-2005. Results show that, in accordance with the theory of legitimacy, some parameters of the company affect its societal disclosure index. These variables are the size of the company and its membership to the financial sector. Moreover, a significant nonlinear relation is highlighted between the disclosure index and the future cost of equity. It is negative for low levels and positive for higher levels.
