Using video to disclose forward-looking information: the effect of nonverbal cues on investors’ judgments

Nicole L. Cade (), Lisa Koonce () and Kim I. Mendoza ()
Additional contact information
Nicole L. Cade: University of Pittsburgh
Lisa Koonce: The University of Texas at Austin
Kim I. Mendoza: University of Illinois at Urbana-Champaign

Review of Accounting Studies, 2020, vol. 25, issue 4, No 8, 1444-1474

Abstract: Abstract We conduct two experiments to examine how investors react to nonverbal cues of certainty as displayed by a CEO communicating forward-looking information via the relatively new and emerging medium of video. Results of the first experiment suggest that, at least for the setting we examine, investors react more negatively (do not react more positively) to a video disclosure when the CEO displays nonverbal cues of uncertainty (certainty), relative to the same disclosure delivered via audio or written text. A second experiment reveals that the lack of a positive reaction to the certain CEO in the video may be due to investors’ belief that the CEO has incentives to convey certainty via nonverbal cues. Indeed, even a subsequent good-news realization—which should add credibility to the CEO’s certainty cues—does not change this perception. Our study has implications for firms considering video as a medium for disclosure.

Keywords: Nonverbal cues; Certainty; Video; Forward-looking disclosures (search for similar items in EconPapers)
JEL-codes: D81 M41 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1007/s11142-020-09539-8 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:reaccs:v:25:y:2020:i:4:d:10.1007_s11142-020-09539-8

Ordering information: This journal article can be ordered from
http://www.springer.com/accounting/journal/11142

DOI: 10.1007/s11142-020-09539-8

Access Statistics for this article

Review of Accounting Studies is currently edited by Paul Fischer

More articles in Review of Accounting Studies from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().