The power of voice: Managerial affective states and future firm performance

Published

Journal Article

We measure managerial affective states during earnings conference calls by analyzing conference call audio files using vocal emotion analysis software. We hypothesize and find that, when managers are scrutinized by analysts during conference calls, positive and negative affects displayed by managers are informative about the firm's financial future. Analysts do not incorporate this information when forecasting near-term earnings. When making stock recommendation changes, however, analysts incorporate positive but not negative affect. This study presents new evidence that managerial vocal cues contain useful information about a firm's fundamentals, incremental to both quantitative earnings information and qualitative "soft" information conveyed by linguistic content. © 2012 the American Finance Association.

Full Text

Duke Authors

Cited Authors

  • Mayew, WJ; Venkatachalam, M

Published Date

  • February 1, 2012

Published In

Volume / Issue

  • 67 / 1

Start / End Page

  • 1 - 44

Electronic International Standard Serial Number (EISSN)

  • 1540-6261

International Standard Serial Number (ISSN)

  • 0022-1082

Digital Object Identifier (DOI)

  • 10.1111/j.1540-6261.2011.01705.x

Citation Source

  • Scopus