The Peer Deterrent Effect of Whistleblowing on Financial Reporting Aggressiveness

SYNOPSIS Extant literature demonstrates that whistleblowing is associated with changes in the target’s financial reporting. This paper provides compelling evidence also affects peer firms’ Specifically, we find industry peers reduce their reporting aggressiveness following a allegation. deterrent effect stronger when firm geographically closer to target, and target share board member, predicted have high probability of misstatement, larger. Our findings are robust an array estimation methods, definitions, examining windows, placebo test. Data Availability: available from public sources cited text. JEL Classifications: D22; G30; M41.