Do Managers’ Nonnative Accents Influence Investment Decisions?

The Accounting Review, Forthcoming

53 Pages Posted: 8 Jul 2021

See all articles by Leonardo Barcellos

Leonardo Barcellos

Emory University, Goizueta Business School, Students

Kathryn Kadous

Emory University - Goizueta Business School

Date Written: July 6, 2021

Abstract

Reactions to earnings calls are sensitive to subtle features of managers’ speech, but little is known about the effect of nonnative accents in this setting. Nonnative-accented CEOs may avoid holding calls in English for fear of investors’ negative stereotypes. However, theory indicates that stereotypes from the CEO position and nonnative accents conflict, and that the process of reconciling conflicting stereotypes requires effortful processing. We use a series of four experiments to test each link of the causal chain that we hypothesize based on this theory. We demonstrate that motivated investors reconcile conflicting stereotypes by inferring exceptional qualities, such as hard work and determination, that positively affect their impressions of nonnative-accented CEOs and, hence, of the company as an investment. We also show that, because bad news stimulates effortful processing, investors receiving bad (versus good) news are more likely to form a positive image of nonnative-accented CEOs and their companies.

Keywords: Earnings conference calls, investment decisions, nonnative accents, impressions of CEOs

Suggested Citation

Barcellos, Leonardo and Kadous, Kathryn, Do Managers’ Nonnative Accents Influence Investment Decisions? (July 6, 2021). The Accounting Review, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3881429

Leonardo Barcellos (Contact Author)

Emory University, Goizueta Business School, Students ( email )

1300 Clifton Road
Atlanta, GA 30322-2722
United States

Kathryn Kadous

Emory University - Goizueta Business School ( email )

1300 Clifton Road
Atlanta, GA 30322-2722
United States
404-727-4967 (Phone)

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