Financial Opacity and Firm Performance: The Readability of REIT Annual Reports

Dempsey, Stephen J.; Harrison, David M.; Luchtenberg, Kimberly F.; Seiler, Michael J.

doi:10.1007/s11146-010-9263-2

Cited by 78 publications

(64 citation statements)

References 48 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Regarding the role of sentiment in corporate annual reports, our study contributes to the earlier literature by adding specific sustainability context. In contradiction with earlier findings for U.S. companies [16,70], we did not observe the positive effect of the overall sentiment in annual reports on profitability. However, we argue that the context of the sentiment is important for profitability prediction, and that, in agreement with [15], domain-specific dictionaries can be effectively used to predict profitability of U.S. companies.…”

Section: Discussioncontrasting

confidence: 99%

“…There are several studies arguing that the positive sentiment of corporate communication in annual reports has a positive impact on the overall CFP of U.S. companies [15,69], as well as their profitability [16,70]. The importance of text in annual reports for CFP prediction was recognized in [71], suggesting that the tone and subjects emphasized are different for poorly performing companies.…”

Section: Relationship Between Corporate Sustainability Csr and Finanmentioning

confidence: 99%

“…Specifically, a more frequent use of positive words is associated with higher future profitability. Dempsey et al [70] find that poorly performing U.S. companies in terms of ROA have significantly greater annual report opacity. More recently, traditional general dictionaries were replaced with domain-specific financial dictionaries of negative and positive words to show that the prediction accuracy of unexpected earnings can be improved [75].…”

Section: Relationship Between Corporate Sustainability Csr and Finanmentioning

confidence: 99%

See 2 more Smart Citations

Sustainability and Corporate Social Responsibility in the Text of Annual Reports—The Case of the IT Services Industry

Myšková

Hájek

2018

Sustainability

View full text Add to dashboard Cite

Annual reports are an important source of qualitative information about a company's strategic areas, including sustainability. However, previous work on sustainability assessment has been limited to quantitative indicators that are difficult to obtain. Here, we address this issue by analyzing a company's strategic documents, with the specific aim of demonstrating the role of sustainability and social responsibility in the text of the annual reports of companies in the IT services industry. We demonstrate that this information is a significant determinant of future economic outcomes. Specifically, here we evaluate sentiment in managerial communication in the area of sustainable business by using collocation analysis of topic and sentiment word lists. Several domain-specific word lists were used for each category monitored. Specifically, Loughran and McDonald's word list was used to measure sentiment in the context of corporate social responsibility and sustainability. The word list that was developed by Pencle and Malaescu was used for CSR, while novel word lists are proposed for sustainability topics. The results of experiments show that the sentiment of sustainability topics (environmental and social in particular) in the annual reports may be a significant indicator of future profitability and thus represent an important information for corporate stakeholders.Sustainability 2018, 10, 4119 also be conducted, owing to their positive effect on corporate financial performance (CFP) [4]. Chandler [48] analyzed more than 20 case studies to illustrate issues related to CSR, including financial, organizational, and societal issues, and also highlighted the importance of strategic CSR. This finding was also supported by the empirical evidence in [49], suggesting that a lack of success in CSR was a major cause of the financial crisis.The importance of CSR communication was highlighted and a conceptual framework for this communication was developed in [50]. It is argued that such communication is important both in the short-term (supporting stakeholders' favorable behavior and attitudes) as well as in the longer term (affecting stakeholder-company relationships and company's image). In contrast, the lack of the communication is considered to be a barrier to maximize financial benefits from CSR activities. Several communication channels have been proposed for corporate sustainability and CSR in [50], such as annual reports, companies' websites, CSR reports, or advertising. A recent review of literature on CSR communication can be found in [1], identifying legitimacy theory as the dominant theory in examining CSR communication. Companies use their communication channels to manage perceived CSR legitimacy by showing that their activities are appropriate and desirable. Another survey that was performed in [51] finds that minimal releases, such as annual reports and websites, are increasingly preferable communication channels, rather than advertising or company's releases. However, it should also be noted that not all the corp...

show abstract

Section: Discussioncontrasting

confidence: 99%

Section: Relationship Between Corporate Sustainability Csr and Finanmentioning

confidence: 99%

Section: Relationship Between Corporate Sustainability Csr and Finanmentioning

confidence: 99%

See 1 more Smart Citation

Sustainability and Corporate Social Responsibility in the Text of Annual Reports—The Case of the IT Services Industry

Myšková

Hájek

2018

Sustainability

View full text Add to dashboard Cite

show abstract

“…corporate communication (Dempsey et al 2012) or legislation (van Boom 2014. This is why, in a second step, we apply a number of readability formulas to the text which was entered by the user in the interface.…”

Section: Readability Judgement Based On Classical Formulasmentioning

confidence: 99%

Stylene: an Environment for Stylometry and Readability Research for Dutch

Daelemans

Clercq

Hoste

2017

CLARIN in the Low Countries

View full text Add to dashboard Cite

We describe an educational demonstration interface and tools for stylometry (authorship attribution and pro ling) and readability research for Dutch. The Stylene system consists of a popularisation interface for learning about stylometric analysis, and of web-based interfaces to so ware for readability and stylometry research aimed at researchers from the humanities and social sciences who do not want to develop or install such so ware themselves. IntroductionThe last decade has seen a marked increase in research on computational stylometry, the subarea of natural language processing that concerns itself with the categorisation of texts according to the psychological and sociological properties of their authors. Also called text pro ling, this research tries to develop systems, mostly based on text analytics techniques, that combine natural language processing and machine learning methods. These systems are trained to determine whether the author of a text is male or female, their education level, region of origin, personality, and even mental health, whether they are a native speaker or not, and many other potentially useful attributes. Of course, authorship attribution research has existed for a long time, and is in a sense the limit case of computational stylometry: supposing that everyone has a unique combination of demographic, psychological and idiosyncratic style properties, this would be their idiolect or 'stylome' (Van Halteren et al, 2005;Coulthard, 2004), and it should be possible to assign texts of unknown authorship to speci c authors provided that models of their stylome exist.

show abstract

“…7 As real estate is a capital intensive business, REITs have a compelling incentive to ensure their disclosures are not misleading or distorted. Otherwise, they run the risk of increased capital costs and limits to growth (Hardin et al 2009;Dempsey et al 2012;and others). This sample feature stands in stark contrast to a sample randomly drawn from the universe of typical equities, where it would be difficult to cleanly control for differences in the incentive to be forthcoming in call disclosures.…”

Section: Introductionmentioning

confidence: 99%

Do Investors Infer Vocal Cues from CEOs During Quarterly REIT Conference Calls?

Price

Seiler

Shen

2016

J Real Estate Finan Econ

Self Cite

View full text Add to dashboard Cite

We examine the investor reaction to emotionally charged information. Using audio files of quarterly earnings conference calls and specialized Layered Voice Analysis software, we isolate the emotional content of managers' vocal cues. With results that are both statistically and economically significant, we find that executive emotion is positively related to investors' initial reaction. Moreover, this strong investor reaction to emotional signals by REIT managers appears to be justified, suggesting that credible, value-relevant information is contained in the emotion related signals. However, we also find some limited evidence of a partial reversal in subsequent trading windows, suggesting that investors may second guess themselves or fear they overreacted.

show abstract

Financial Opacity and Firm Performance: The Readability of REIT Annual Reports

Cited by 78 publications

References 48 publications

Sustainability and Corporate Social Responsibility in the Text of Annual Reports—The Case of the IT Services Industry

Sustainability and Corporate Social Responsibility in the Text of Annual Reports—The Case of the IT Services Industry

Stylene: an Environment for Stylometry and Readability Research for Dutch

Do Investors Infer Vocal Cues from CEOs During Quarterly REIT Conference Calls?

Contact Info

Product

Resources

About