This paper reviews and proposes additional research concerning the role of publicly reported financial accounting information in the governance processes of corporations. We first discuss research on the use of financial accounting in... more
This paper reviews and proposes additional research concerning the role of publicly reported financial accounting information in the governance processes of corporations. We first discuss research on the use of financial accounting in managerial incentive plans and explore future research directions. We then propose that governance research be extended to explore more comprehensively the use of financial accounting information in additional corporate control mechanisms, and suggest opportunities for expanding such research. We also propose crosscountry research to investigate more directly the effects of financial accounting information on economic performance through its role in governance and more generally. r (R.M. Bushman). 0165-4101/01/$-see front matter r 2001 Elsevier Science B.V. All rights reserved. PII: S 0 1 6 5-4 1 0 1 (0 1) 0 0 0 2 7-1
