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

Man Dang, Prem Puwanenthiren, Edward Jones, Nguyen Bui and Thuy Dung Le 2024. Does corporate culture shape “Tone at the Top”? Evidence from earnings calls. Finance Research Letters. 59 104698. https://doi.org/10.1016/j.frl.2023.104698

TitleDoes corporate culture shape “Tone at the Top”? Evidence from earnings calls
TypeJournal article
AuthorsMan Dang, Prem Puwanenthiren, Edward Jones, Nguyen Bui and Thuy Dung Le
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.

KeywordsCorporate culture
Management tone
Earnings calls
Information and governance environments
Earnings quality
Machine learning
Article number104698
JournalFinance Research Letters
Journal citation59
ISSN1544-6123
1544-6131
Year2024
PublisherElsevier
Digital Object Identifier (DOI)https://doi.org/10.1016/j.frl.2023.104698
Publication dates
Published online09 Nov 2023
Published in printJan 2024

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