Market regulators are concerned about the completeness of management-provided explanations in financial reports and other venues. In particular, the Securities and Exchange Commission has articulated the growing problem of firm managers selectively emphasizing information that is favorable to...

We test whether investors react more strongly to narrative disclosures when the CEO's presence or association with the message is more salient in the disclosure, holding all other information constant. In our first experiment, we manipulate whether a CEO uses more personal pronouns (e.g.,...

We use an experiment with experienced managers to provide more-direct evidence on how reporting goals and firm performance influence language choices. We find that bad news disclosures are less readable than good news, but only when managers have a stronger self-enhancement motive. Our results...