A comparative analysis of impression management in chairman's statement amongst profitable and unprofitable JSE-listed companies during Covid-19 pandemic.

Abstract

The study examined whether profitable and less profitable Top 100 Johannesburg Stock Exchange (JSE) listed companies used impression management during the Coronavirus (COVID-19) pandemic through textual characteristics in the chairperson's statement. The chairperson's statement is one of the most frequently read and highly rated narrative disclosure statements in the integrated report (IR). Quantitative content analysis was used to analyse the chairperson's statements of the Top 100 JSE-listed companies. The profitable and less profitable companies were evaluated using six textual characteristics, namely the length of the chairperson's statement, the use of passive voice, the use of personal references, the use of quantitative references, the use of future references, and the readability score. The study found that both profitable and less profitable top 100 JSE-listed companies used impression management in the chairperson's statement during the pandemic. Moreover, both groups used the passive voice as well as future, personal, and quantitative references in the chairperson's statement, even during the COVID-19 pandemic. There was no significant difference in readlability, quantitative references, passive voice, personal references, length, and future references. The results are contrary to previous research that indicates that impression management is used less during a crisis than during normal economic conditions. The study shows that the chairperson's statements are used by management as a form of attribution, which is a self-serving bias that could lead to the misallocation of capital by investors. The study adds to the debate on the use of impression management in corporate reporting during the crisis and adds to the debate on attribution theory.