Does corporate culture shape “Tone at the Top”? Evidence from earnings calls

Man Dang; Premkanth Puwanenthiren; Edward Jones; Nguyen Bui; Thuy Dung Le

doi:10.1016/j.frl.2023.104698

Does corporate culture shape “Tone at the Top”? Evidence from earnings calls

Man Dang, Premkanth Puwanenthiren, Edward Jones, Nguyen Bui, Thuy Dung Le

Research output: Contribution to journal › Article › peer-review

1 Citation (Scopus)

Abstract

This study investigates how corporate culture affects the tone of managerial communications. Using data from earnings calls of U.S.-listed firms over 2001-2021, we find firms with strong culture values characterized by innovation, integrity, quality, respect, and teamwork experience more positive tone. Our findings remain unchanged after addressing endogeneity and the use of entropy balancing approach. Further, the culture-tone relationship is more pronounced in weak information and governance environments. Overall, this study provides insights on the benefits of promoting a strong corporate culture.

Original language	English
Article number	104698
Journal	Finance Research Letters
Volume	59
Early online date	9 Nov 2023
DOIs	https://doi.org/10.1016/j.frl.2023.104698
Publication status	Published - Jan 2024

Keywords

Corporate culture
Earnings calls
Earnings quality
Information and governance environments
Machine learning
Management tone

ASJC Scopus subject areas

Finance

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10.1016/j.frl.2023.104698

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title = "Does corporate culture shape “Tone at the Top”? Evidence from earnings calls",

abstract = "This study investigates how corporate culture affects the tone of managerial communications. Using data from earnings calls of U.S.-listed firms over 2001-2021, we find firms with strong culture values characterized by innovation, integrity, quality, respect, and teamwork experience more positive tone. Our findings remain unchanged after addressing endogeneity and the use of entropy balancing approach. Further, the culture-tone relationship is more pronounced in weak information and governance environments. Overall, this study provides insights on the benefits of promoting a strong corporate culture.",

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author = "Man Dang and Premkanth Puwanenthiren and Edward Jones and Nguyen Bui and Le, {Thuy Dung}",

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AU - Bui, Nguyen

AU - Le, Thuy Dung

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AB - This study investigates how corporate culture affects the tone of managerial communications. Using data from earnings calls of U.S.-listed firms over 2001-2021, we find firms with strong culture values characterized by innovation, integrity, quality, respect, and teamwork experience more positive tone. Our findings remain unchanged after addressing endogeneity and the use of entropy balancing approach. Further, the culture-tone relationship is more pronounced in weak information and governance environments. Overall, this study provides insights on the benefits of promoting a strong corporate culture.

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KW - Earnings quality

KW - Information and governance environments

KW - Machine learning

KW - Management tone

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Does corporate culture shape “Tone at the Top”? Evidence from earnings calls

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Keywords

ASJC Scopus subject areas

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