 Using corporate social responsibility performance to evaluate financial disclosure credibilityLei Wang and Brad Tuttle Accounting and Business Research, 2014, vol. 44, issue 5, 523-544 Abstract: Due to the paucity of immediate and direct information about financial disclosure credibility, it is often difficult for investors to assess the credibility of financial disclosures (e.g. whether reported earnings are biased). Given this situation, the present study proposes and finds that investors use additional cues, such as information about corporate social responsibility (CSR) performance, to form overall impressions about management's honesty, credibility, and trustworthiness. Similar to other findings in the halo effect literature, we find that these overall impressions subsequently influence both investors' assessments of financial disclosure credibility and the prices they are willing to pay for a company's stock. The findings support the theoretical framework on financial disclosure credibility by (1) showing that management credibility is an important tool that investors use to assess disclosure credibility and (2) suggesting that management credibility is a multidimensional latent construct for which CSR performance can be one of several relevant indicators. Date: 2014 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:acctbr:v:44:y:2014:i:5:p:523-544 Ordering information: This journal article can be ordered from DOI: 10.1080/00014788.2014.922408 Access Statistics for this article Accounting and Business Research is currently edited by Vivien Beattie More articles in Accounting and Business Research from Taylor & Francis Journals |
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