Journal of Business Ethics 124 (1):1-16 (2014)

Abstract
In this study, we explore the sincerity of the rhetorical tone of 664 annual letters to shareholders (CEO letters). Prior studies adopt Impression Management theory to predict that firms obfuscate failures and emphasize successes to unfairly enhance their image and maintain organizational legitimacy. Yuthas et al. (J Bus Ethics 41:141–157, 2002) challenged such a view, showing that firms reporting earnings surprises engage in ethical discourse with shareholders. We adopt the methodology of Yuthas et al. (J Bus Ethics 41:141–157, 2002) to explore the association between firm performance and the rhetorical features of CEO letters in a large sample of Fortune 500 firms in the wake of the global economic crisis. In contrast to most prior research, we find that optimistic tone is congruent with both past and future performance. We conclude that under tough macroeconomic conditions, incentives to distort public information strategically are low. Rather, firms tend to engage in communicative action aimed at dialoguing with shareholders through sincere disclosure. However, in our conclusions, we warn about the impact of accounting and rhetorical manipulation on the congruence between optimistic tone and financial performance
Keywords Discourse ethics  Optimism  DICTION  Impression management  Economic crisis
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Reprint years 2014
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DOI 10.1007/s10551-013-1855-3
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Moral Consciousness and Communicative Action.David M. Rasmussen - 1993 - Philosophical Quarterly 43 (173):571.
The Measurement of Meaning.Charles Egerton Osgood - 1957 - London: Urbana, University of Illinois Press.

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