From www.sciencedirect.com: Investors experience uncertainty regarding the relationship intensity between firms, which affects asset pricing and firms’ incentives to disclose such relationships.

Mandatory disclosure of relationship intensities may inadvertently hinder relationship formation and negatively impact investor welfare, as firms might avoid disclosing relationships that could enhance coordination and collaboration.

The study concludes that optimal disclosure policies depend on the balance between collaboration quality and risk, suggesting that firms may choose not to disclose under certain conditions to maintain relationship opportunities.