Market reaction to the positiveness of annual report narratives

Liafisu Sina Yekini, Tomasz Piotr Wisniewski, Yuval Millo

Research output: Contribution to journalArticlepeer-review

35 Citations (Scopus)
248 Downloads (Pure)


This paper focuses on narratives published by UK companies, defined here as the content of annual reports excluding financial statements and notes to accounts. We endeavour to gauge the tone of these narratives by recording the frequency of positive words appearing in the text. We show that the extent of positiveness is related to market reaction around the disclosure date. This conclusion is maintained even after controlling for the financial figures that are reported simultaneously and company-specific characteristics. Consequently, narratives should not be perceived as mere impression management tools, but also as conduits for disseminating price-sensitive information.
Original languageEnglish
Pages (from-to)415-430
JournalThe British Accounting Review
Issue number4
Publication statusPublished - 11 Dec 2015

Bibliographical note

NOTICE: this is the author’s version of a work that was accepted for publication in The British Accounting Review. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in The British Accounting Review, [VOL 48, ISSUE 4, (2015)] DOI: 10.1016/

© 2015, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International


  • Annual report narrative
  • Content analysis
  • Stock market reaction


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