UNEQUAL PERFORMACNE FEEDBACK: THE DIFFERENTIAL EFFECTS OF ANALYST FOREFACTS AND HISTORICAL/SOCIAL ASPIRATION LEVELS ON CSR DISCLOSURES

Time: 14:00, April 20th 2016

Venue: Room 206, Tongji Building A

Abstract:

In this study, I examine the differential effects of different performance targets (i.e., analyst forecasts and historical/social aspiration levels), as well as their consistency and inconsistency, on less risky firm behaviors—CSR disclosures. Specifically, I find that performance above or below analyst forecasts is positively associated with CSR disclosures, although the influence is much stronger when performance meets or exceeds analyst forecasts than when performance misses analyst forecasts. In contrast, performance above historical or social aspiration levels is negatively associated with CSR disclosures, whereas performance below historical or social aspiration levels has no effect. Furthermore, I find that managers will increase CSR disclosures when a specific inconsistent pattern of performance targets occur, that is, when performance misses analyst forecasts but is above managers’ historical or social aspiration levels. These findings can have several theoretical contributions to ongoing studies on performance feedback.