Corporate governance and impression management in annual results press releases

Beatriz Garcia Osma and Encarna Guillamón-Saorín

Accounting, Organizations and Society, 2011, vol. 36, issue 4, 187-208

Abstract: We study the association between corporate governance and impression management in annual results press releases (ARPRs). Press releases constitute a timely vehicle to communicate firm performance to third parties but they can be manipulated to distort readers’ perceptions of corporate achievements. We predict that governance mechanisms actively monitor managerial disclosures, improving firm transparency and thus reducing impression management in ARPRs. The results confirm that strong governance limits impression management, consistent with governance monitoring effectively reducing self-serving disclosures by management. Our evidence suggests that management disclosure practices respond, at least partly, to informative motivations. We also show that strong governance firms are more likely to release an ARPR.

Date: 2011
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Citations: View citations in EconPapers (45)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:aosoci:v:36:y:2011:i:4:p:187-208

DOI: 10.1016/j.aos.2011.03.005

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