Working Paper | HBS Working Paper Series | 2015

Speaking of the Short-Term: Disclosure Horizon and Managerial Myopia

by Francois Brochet, Maria Loumioti and George Serafeim


We study conference calls as a voluntary disclosure channel and create a proxy for the time horizon that senior executives emphasize in their communications. We find that our measure of disclosure time horizon is associated with capital market pressures and executives' short-term monetary incentives. Consistent with the language emphasized during conference calls partially capturing short-termism, we show that our proxy is associated with earnings and real activities management. Overall, the results show that the time horizon of conference call narratives can be informative about managers' myopic behavior.

Keywords: Short-termism; Managerial myopia; earnings management; Real activities management; Accounting performance; Business Ventures; Business and Stakeholder Relations; Stocks; Volatility; Cost of Capital; Resource Allocation; Risk and Uncertainty;


Brochet, Francois, Maria Loumioti, and George Serafeim. "Speaking of the Short-Term: Disclosure Horizon and Managerial Myopia." Harvard Business School Working Paper, No. 12-072, February 2012. (Revised August 2012, February 2014, March 2015.)