The impact of financial communication on the financial performance of companies: development of a conceptual model

Abstract

In a context of financial globalization, the search for financing resources has become a battleground between companies. The advantages offered by stock exchanges at this level are increasingly important. But the risks inherent to the problems of transparency and asymmetry of information constitute the playground for improving the performance of stock exchanges not only in Morocco but worldwide.

In this paper, we propose a conceptual model to examine the causal link between the disclosure of different types of information (financial and non-financial) by companies listed on the Casablanca Stock Exchange and their financial performance. This link is explained by the capacity of financial communication, through the information disseminated, to act on the behavior of the different stakeholders by forming, thus, a certain level of confidence, which would be subsequently reflected in the financial performance.

At the beginning, the models developed in the literature need to be fine-tuned, the concepts operationalized, the model designed and the assumptions determined. The recommendations gathered from the literature make the basis of the proposed conceptual model.

Our main motivation is to propose an original model designed in a particular Moroccan context and marked essentially by the scarcity of research studies in this sense.

The formulated and defined hypotheses will be tested, in a future work, with the help of a questionnaire addressed to the users of the communicated information using structural equations as a method.

Keywords: Financial Communication, Trust, Financial Performance

JEL Classification:  L25

Paper type: Theoretical Research