Benefits of Compliance with Securities Listing Standards: Evidence From the Depository Receipt Market


Abdourahmane Sarr

Publication Date:

May 1, 2001

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate


The paper finds that costs of implementing stringent securities listing standards may exceed benefits. Depository receipts, a growing source of international equity financing, differ in types by the reporting and disclosure standards issuing firms are required to meet. For lower levels of compliance, results show that factors associated with the stage of economic development of the issuing firm's country account for the lower levels of capital raised. Incurring reporting costs to comply with higher standards may thus be inefficient. In contrast, firms choosing to meet higher reporting and disclosure standards do so because the information revealed would have a positive effect on capital raised.


Working Paper No. 2001/079



Publication Date:

May 1, 2001



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