Risk Disclosure in the European Banking Industry: Qualitative and Quantitative Content Analysis Methodologies

Abstract

This book aims to shed light on the advantages and disadvantages of both qualitative and quantitative content analysis methodologies by examining risk disclosure practices in the European banking industry. Content analysis methodologies allow to assess the level of transparency of financial and non-financial reports by focusing on the information disclosed to the public with reference to their risk exposure and management. There is an ongoing debate in the literature to understand whether qualitative or quantitative content analysis methodologies are more effective and useful to analyse disclosure practices. Some authors contend that qualitative methodologies may be more appropriate because they allow to analyse in depth disclosures, to get insights into aspects that quantitative methodologies would overlook, they are flexible and they allow researchers to draw meaningful conclusions from the analysis (Scannella, 2018; Scannella & Polizzi, 2018). In contrast, other authors prefer to employ quantitative methodologies, motivated by the fact that they are less affected by the level of subjectivity of the researchers that carry out the analyses, and they can be easily automated by means of computer-aided textual analyses (Farina et al., 2018, 2019). While the approach of the latter school of taught is much more employed in the literature, this book shows how both approaches are equally useful in investigating disclosure practices.