Corporate Ownership & Control / Volume 16, Issue 4, Summer 2019 56 FIRM CHARACTERISTICS AND FORWARD-LOOKING RISK DISCLOSURE: EVIDENCE FROM THE ITALIAN CONTEXT Mauro Romano * , Marco Taliento * , Christian Favino ** , Antonio Netti *** * University of Foggia, Italy ** Corresponding author, University of Foggia, Italy Contact details: Department of Economics, University of Foggia, Via Romolo Caggese n. 1, 71121 Foggia, Italy *** University of Pisa, Italy 1. INTRODUCTION In recent years, following the accounting scandals and financial crisis, there has been growing attention on risk disclosure from a wide range of information users including regulators, investors, policy maker, auditors and financial analysts. Empirical evidence from the academic community showed that the voluntary risk disclosure decreases the cost of capital and improves resources allocation (Akerlof, 1970; Botosan, 1997; Solomon et al., 2000; Healy and Palepu, 2001; Magnan & Markarlan, 2011), reduces both information asymmetries and agency conflict, increases transparency of financial statements (Jensen & Meckling, 1976; Healy & Palepu, 2001) and enhances market efficiency (Lajili & Zéghal, 2005; Linsley & Shrives, 2006; Marshall & Weetman, 2007; Dobler, 2008; Campbell et al. 2014; Elshandidy & Abstract How to cite this paper: Romano M., Taliento M., Favino C., & Netti A. (2019). Firm characteristics and forward-looking risk disclosure: Evidence from the Italian context. Corporate Ownership & Control, 16(4), 56-65. http://doi.org/10.22495/cocv16i4art5 Copyright © 2019 The Authors This work is licensed under a Creative Commons Attribution 4.0 International License (CC BY 4.0). https://creativecommons.org/licenses/by/ 4.0/ ISSN Online: 1810-3057 ISSN Print: 1727-9232 Received: 29.04.2019 Accepted: 12.07.2019 JEL Classification: G32, M40, M48 DOI: 10.22495/cocv16i4art5 This paper aims to examine the relationship between firm determinants and forward-looking risk disclosure in the Italian context. In particular, analysing a sample of non-financial Italian listed companies, we ran a regression model to investigate the influence of preminent firms’ characteristics (independent variable) on the forward-looking risk disclosure (dependent variable). Findings highlight that firm size and independent directors are positively related to forward-looking risk information; on the contrary, other firms’ features are not statistically relevant. The results obtained suggest that, in the examined context, large sized companies are inclined to disclose forward-looking estimation to reduce asymmetry information and to attract potential investors. Moreover, larger firms are more likely to disclose additional information because they can bear more easily the cost of future projections and extended disclosure than the smallest companies. This study adds empirical findings to the accounting literature and it could be helpful to regulators and policy makers, in order to enhance information quality and to increase transparency in the annual report as well. Keywords: Firm Characteristics, Forward-Looking Risk Disclosure, Content Analysis, Italian Non-Financial Listed Companies Authors’ individual contribution: Conceptualization – M.R., M.T., C.F., and A.N.; Methodology - C.F. and A.N.; Validation - M.R. and M.T.; Resources - A.N.; Writing – C.F. and A.N.; Supervision – M.R. and M.T. Acknowledgement: Published with a contribution from 5 x 1000 IRPEF funds in favour of the University of Foggia, in memory of Gianluca Montel.