What's My Style? The Influence of Top Managers on Voluntary Corporate Financial Disclosure

Financial economics has posited a limited role for idiosyncratic noneconomic manager-specific influences, but the strategic management literature suggests such individual influences can affect corporate outcomes. We investigate whether individual managers play an economically significant role in their firms' voluntary financial disclosure choices. Tracking managers across firms over time, we find top executives exert unique and economically significant influence (manager-specific fixed effects) on their firms' voluntary disclosures, incremental to known economic determinants of disclosure, and firm- and time-specific effects. Managers' unique disclosure styles are associated with observable demographic characteristics of their personal backgrounds: managers promoted from finance, accounting, and legal career tracks, managers born before World War II, and those with military experience develop disclosure styles displaying certain conservative characteristics; and managers from finance and accounting and those with military experience favor more precise disclosure styles. These plausible associations confirm that our estimated manager-specific fixed effects capture systematic long-lived differences in managers' unique disclosure styles.