How does language choice reflect organisational success?
Businesses are required to report ever greater amounts of information to the public, and investors in particular, about their financial position and how this is changing over time. However, there is also the risk that poorly worded statements, especially to important stakeholders, might undermine communication efforts. To explore this issue, recent US research from Duke University…
Businesses are required to report ever greater amounts of information to the public, and investors in particular, about their financial position and how this is changing over time.
However, there is also the risk that poorly worded statements, especially to important stakeholders, might undermine communication efforts.
To explore this issue, recent US research from Duke University has analysed how specific word choices correlate to organisational performance. The study examined investor relations statements across the last 20 years in 460 companies which later filed for bankruptcy.
Each of these was then investigated to identify key terms that might be associated with below-average financial performance. As well as obvious words like “bankruptcy” or “fail”, the researchers also looked at less obvious terms like “renegotiate”.
The research found there was a clear connection between the use of this language and the financial position of the company, one which often went beyond the data and information usually found in these documents.
To explain this, the study’s authors suggested that how financial reports are written and communicated to investors forms a unique layer of information – one which investors are picking up. In fact, the report proposed that this language had a predictive power that goes beyond the specific figures contained within a report.
According to one of the study’s authors, Professor Bill Mayew; “What this shows is there’s quite a bit of potency in what managers are already saying.”
“I didn’t think it [this correlation] would be that powerful, to be quite honest.”
For communication experts with oversight for investor relations, this research highlights how important it is manage the flow of business information, both written and numerical. As investors demand greater levels of data on areas like finance, being able to manage these perceptions will be essential for supporting an organisation.
Discover insights.
Creating messages that cut through social media, news cycles and even the humble inbox has never been easy, but, with more noise across more channels, it’s become more important than ever to create messages that stand out and land with impact. Visual communications tools are gaining traction as a way of shaping messages that hit…
Looking for greater choice in the contract options available to you? Having history and rapport with a specialist recruiter like Fraser Clapcott will open doors to opportunities you may have missed for yourself, that add value for both contractor and employer. In the current climate of uncertainty, a willingness and propensity for flexibility comes with…
If you’ve been ruminating on changing-up your comms career, now may be the ideal time to talk with your trusted recruiter about making a move. Salt & Shein Director, Lucy Newcomb, sees significant scope for motivated communicators to broaden their career horizons, and make the job of their dreams a reality, in 2023. “A rapidly…
Discover insights.
12.13.2023
Visuals hit the mark in a fast-paced world
Creating messages that cut through social media, news cycles and even the humble inbox has never been easy, but, with more noise across more channels, it’s become more important than ever to create messages that stand out and land with impact. Visual communications tools are gaining traction as a way of shaping messages that hit…
05.10.2023
Rapport yields exceptional results for contractors
Looking for greater choice in the contract options available to you? Having history and rapport with a specialist recruiter like Fraser Clapcott will open doors to opportunities you may have missed for yourself, that add value for both contractor and employer. In the current climate of uncertainty, a willingness and propensity for flexibility comes with…
05.04.2023
Curious about the current state of play for communicators?
If you’ve been ruminating on changing-up your comms career, now may be the ideal time to talk with your trusted recruiter about making a move. Salt & Shein Director, Lucy Newcomb, sees significant scope for motivated communicators to broaden their career horizons, and make the job of their dreams a reality, in 2023. “A rapidly…
10.21.2022
How to Drive Value Using Digital Marketing
Digital marketing drives value – for those who keep pace Faster communication, lower costs, higher conversion – is there anything digital marketing can’t do? Its ability to drive value from every step of the marketing process is unprecedented, but maximising this value is a demanding exercise. We asked two specialists in this area to tell…
06.14.2022
Economic Challenges Threaten to Cloud the Focus on ESG
ESG is just one challenge on Government’s long list The government’s election promises around environmental, social and governance (ESG) issues were instrumental in its victory a few weeks ago, reflecting a mandate to treat climate change, gender equity and other ESG matters as essential. “Australian businesses know that action on climate change is good for…
05.31.2022
Addressing the skills shortage
Unlocking opportunities for families across Australia As a boutique executive search firm, we’ve seen up close the impact of Australia’s labour shortage as the pool of candidates continues to shrink, limiting the growth of careers and businesses – and hampering national productivity. With some 425,000 job vacancies across Australia, no wonder the OECD recommended that…
04.04.2022
Leadership: Why showing employee appreciation and care can go a long way
Everyone has to start from somewhere. Meaning you’ve probably held an entry-level position at one point or another, in which trying to impress the higher-ups in your company was a major part of your job. This article will explore why employee appreciation and recognition are a vital part of holding a leadership role not…
03.18.2022
The future of recruiting includes ESG initiatives
Whether or not a company acknowledges how much their social, environmental and governance (ESG) decisions impact the world around them, candidates are taking notice. Most job seekers will pass over a company that is not taking steps to improve how they show up outside of their business metrics for an organisation that does. This…
01.31.2022
Changes to the work environment in the new norm
People all over the world and especially in Australia have faced incredible challenges in the past two years. Those businesses that survived multiple shutdowns and policy changes are finding new ways to adjust as they enter the post-COVID work environment. As offices begin to reopen, enterprise leaders are not only deciding among the options of…
12.16.2021
Solving the skills shortage: Closed borders and adjusting expectations
With the revolving door of new COVID-19 regulations, variants, opened (then closed again) borders and an exodus of non-Australian workers, the workforce across the nation is facing a severe skills shortage. Despite these challenges, there are solutions. The secret to overcoming this qualifications shortage lies in taking a proactive approach to hiring through policy changes…