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RAAS 2025/06
Vol.15 No.1:
119-148
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Research on the Similarity of Letter to Shareholders in the Biotechnology and Medical Industry
Fu-Yun Liu1, Hui-Min Chung2, Chun-Hsien Yu1*, and Ping-Yi Chuang3
1Department of Financial Management, National Defense University/Gyuan Certified Public Accountants
2Department of Information Management and Finance, National Yang Ming Chiao Tung University
3Department of Management Science, National Yang Ming Chiao Tung University/Gyuan Certified Public Accountants
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Abstract:
This study attempts to explore the correlation between significant economic changes, key human capital changes in companies, and major R&D project progress changes, and the similarity of "letter to shareholders". The study sample consists of publicly listed biotechnology and medical companies from 2017 to 2022. By calculating the text similarity of "letter to shareholders", and conducting regression analysis, the empirical results are as follows: (1) Text analysis shows that the text similarity is generally high (about 87%), indicating that the content of shareholder reports does not vary much from year to year for most companies; (2) Multiple regression analysis indicates that there is a significant negative relationship between changes in a company's market return rate and the similarity of its shareholder reports; (3) Using the Heckman two-stage model to control sample self-selection bias, when the company undergoes economic changes and has abundant key human resources, the shareholder reports will change and show a low similarity situation; Finally, comparing the impact of explanatory variables on text similarity between specially listed and non-specially listed companies reveals a statistically significant difference. Moreover, this impact is more pronounced for specially listed companies. Specifically, when those companies listed under these special regulations experience economic changes or significant R&D progress, the similarity of the shareholder reports changes accordingly, indicating that those company are willing to provide more non-financial information to investors.
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Keywords: Letter to shareholders; Text similarity; Information content
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Corresponding author
; e-mail: jsyu6666@gmail.com
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©
2025
Review of Accounting and Auditing Studies, ISSN 2221-9374
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