How Disclosure Medium Affects Investor Reactions to CEO Bragging, Modesty, and Humblebragging

58 Pages Posted: 2 Apr 2017 Last revised: 16 Mar 2019

See all articles by Stephanie M. Grant

Stephanie M. Grant

University of Washington

Frank D. Hodge

University of Washington - Michael G. Foster School of Business

Roshan K. Sinha

Indiana University - Kelley School of Business - Department of Accounting

Date Written: March 2, 2018

Abstract

We examine if investor expectations of two common disclosure mediums (conference calls and Twitter) interact with a CEO’s communication style to influence investor judgments. Consistent with theory, results show that when the disclosure medium is a conference call, investors are less willing to invest when the CEO is modest about positive firm performance compared to when the CEO brags. In contrast, when the disclosure medium is Twitter, investors are less willing to invest when the CEO brags about positive firm performance compared to when the CEO is modest. Further analysis reveals that perceived CEO credibility mediates the influence of a CEO’s communication style and disclosure medium on investor judgments. Additionally, we find that regardless of the disclosure medium, investors are less willing to invest in a firm when the CEO humblebrags about positive firm performance relative to when he brags or is modest. Our study contributes to the emerging literature on social media and disclosures, and to the literature investigating how style features of disclosures influence investor judgments. Our results also have practical implications for firms and managers developing communication strategies for new disclosure mediums like Twitter.

Keywords: conference calls, Twitter, social media, communication style, expectancy violations theory, humblebrag

JEL Classification: C91, M40, M41, D83

Suggested Citation

Grant, Stephanie M. and Hodge, Frank Douglas and Sinha, Roshan, How Disclosure Medium Affects Investor Reactions to CEO Bragging, Modesty, and Humblebragging (March 2, 2018). Accounting, Organizations and Society, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2943768 or http://dx.doi.org/10.2139/ssrn.2943768

Stephanie M. Grant

University of Washington ( email )

Box 353200
Seattle, WA 98195-3200
United States
(206) 543-2904 (Phone)

Frank Douglas Hodge (Contact Author)

University of Washington - Michael G. Foster School of Business ( email )

Paccar Hall 540, Box 353200
Seattle, WA 98195-3200
United States
206-616-8598 (Phone)
206-685-9392 (Fax)

Roshan Sinha

Indiana University - Kelley School of Business - Department of Accounting ( email )

1309 E. 10th Street
Bloomington, IN 47405
United States

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