THE RELATIONSHIP BETWEEN THE LEVEL OF VOLUNTARY DISCLOSURE AND THE COST OF EQUITY CAPITAL IN NON-FINANCIAL BRAZILIAN

Abstract

The main objective of this research is to examine empirically the existence of a significant relationship between the level of voluntary disclosure of information and the cost of equity capital of Brazilian non-financial companies. It is expected that a greater level of disclosure is related to a lower cost of capital by reducing the risk perceived by investors. In order to measure the level of voluntary disclosure of the companies, a questionnaire  developed for this purpose was used. The cost of equity capital was obtained from publicly available information. A negative and significant relationship between the variables of interest was found, indicating that companies that disclose more information voluntarily has a lower cost of equity capital.