Being more transparent about AI use actually discourages international companies from acquiring a firm.
April 1, 2026
Original Paper
The Role of Artificial Intelligence Disclosure in Shaping the Intensity of International M&A Activity
SSRN · 6235578
The Takeaway
While transparency is usually seen as a way to build trust, AI disclosure acts as a 'double-edged sword' that highlights regulatory and valuation risks. Increased transparency was found to shrink cross-border merger and acquisition activity by roughly 8%, as it alerts buyers to potential legal and national security headaches.
From the abstract
This study develops a novel firm-level measure of artificial intelligence (AI) disclosure intensity using large language models and examines how AI transparency shapes cross-border merger and acquisition (M&A) activity. We find that higher AI disclosure significantly reduces A liquidity: a one–standard-deviation increase in disclosure intensity lowers the cross-border M&A ratio by roughly 0.33 percentage points—about 8% of the sample mean—indicating a meaningful contraction effect. The f