Strategic Disclosure and CEO Media Visibility

Abstract

Prior research indicates that CEO media visibility significantly impacts firm value and CEO career outcomes. We investigate whether and how CEOs strategically use disclosures to influence media coverage of themselves. We develop a measure of "CEO promotion" based on the CEO's presence in firm press releases and the linguistic style of the CEO's quotes. Determinants tests are consistent with our measure of CEO promotion being an intentional act based on cost/benefit considerations. Using our new measure, we find evidence consistent with CEO promotion being effective in reducing journalists' production costs, thereby increasing CEO media coverage and spinning media articles in the firm's favor. These results provide new insights as to specific ways in which CEOs influence media coverage. We also provide an empirical measure of abnormal CEO promotion that can be used in future research.