Dynamics of CEO Disclosure Style

Posted: 2 Jul 2016 Last revised: 8 Nov 2019

See all articles by Khrystyna Bochkay

Khrystyna Bochkay

University of Miami Herbert Business School

Roman Chychyla

University of Miami - School of Business Administration

Dhananjay Nanda

University of Miami - Department of Accounting

Date Written: October 2, 2018

Abstract

We examine changes in CEOs' disclosure styles in quarterly earnings conference calls, over their tenure. Our longitudinal analysis of newly hired CEOs shows that CEOs' forward-looking disclosures and their disclosures' relative optimism decline in their tenure. Further, externally hired and inexperienced CEOs are more future-oriented and younger CEOs exhibit greater optimism in their disclosures. We also find that non-CEO executives' disclosure styles remain time-invariant over their CEO's tenure. Our evidence is consistent with uncertainty reduction about managers' ability over their tenure 1) reducing the demand for and the supply of forward-looking disclosures, and 2) attenuating managerial career concerns leading to the decline in disclosure optimism.

Keywords: CEO tenure, ability uncertainty, career concerns, communication style, forward-looking information, linguistic tone, earnings conference calls, textual analysis

JEL Classification: D82, D83, L20, M12, M51

Suggested Citation

Bochkay, Khrystyna and Chychyla, Roman and Nanda, Dhananjay, Dynamics of CEO Disclosure Style (October 2, 2018). Khrystyna Bochkay, Roman Chychyla, and Dhananjay Nanda (2018) Dynamics of CEO Disclosure Style. The Accounting Review, July 2019, Available at SSRN: https://ssrn.com/abstract=2802622 or http://dx.doi.org/10.2139/ssrn.2802622

Khrystyna Bochkay (Contact Author)

University of Miami Herbert Business School ( email )

5250 University Drive
Coral Gables, FL 33146-6531
United States

Roman Chychyla

University of Miami - School of Business Administration ( email )

Coral Gables, FL 33146-6531
United States
3052842324 (Phone)

Dhananjay Nanda

University of Miami - Department of Accounting ( email )

Coral Gables, FL 33146-6531
United States

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