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The fragile returns to investor relations: evidence from a period of declining market confidence

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The fragile returns to investor relations: evidence from a period of declining market confidence. / Peasnell, K V; Talib, S; Young, S E.

In: Accounting and Business Research, Vol. 41, No. 1, 2011, p. 67-90.

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@article{8888e7c9b8c34b1881e30357545b7f9e,
title = "The fragile returns to investor relations: evidence from a period of declining market confidence",
abstract = "This paper assesses the capital market effects of investor relations activities during a period of high-profile corporate scandals. We find no support for the prediction that an established reputation for effective investor relations helped shield US firms from a perceived decline in management credibility and financial reporting integrity associated with Enron and related scandals. On the contrary, tests reveal that firms with an established reputation for superior investor relations activities fared worse on a series of market-related factors. Results suggest that distrust in corporate reporting practices spilled over to investor relations practices, and that best practice investor relations programmes developed during normal market conditions offered little protection from systemic declines in investor confidence arising from the corporate misdeeds of other firms.",
author = "Peasnell, {K V} and S Talib and Young, {S E}",
year = "2011",
doi = "10.1080/00014788.2011.549638",
language = "English",
volume = "41",
pages = "67--90",
journal = "Accounting and Business Research",
issn = "0001-4788",
publisher = "Routledge",
number = "1",

}

RIS

TY - JOUR

T1 - The fragile returns to investor relations: evidence from a period of declining market confidence

AU - Peasnell, K V

AU - Talib, S

AU - Young, S E

PY - 2011

Y1 - 2011

N2 - This paper assesses the capital market effects of investor relations activities during a period of high-profile corporate scandals. We find no support for the prediction that an established reputation for effective investor relations helped shield US firms from a perceived decline in management credibility and financial reporting integrity associated with Enron and related scandals. On the contrary, tests reveal that firms with an established reputation for superior investor relations activities fared worse on a series of market-related factors. Results suggest that distrust in corporate reporting practices spilled over to investor relations practices, and that best practice investor relations programmes developed during normal market conditions offered little protection from systemic declines in investor confidence arising from the corporate misdeeds of other firms.

AB - This paper assesses the capital market effects of investor relations activities during a period of high-profile corporate scandals. We find no support for the prediction that an established reputation for effective investor relations helped shield US firms from a perceived decline in management credibility and financial reporting integrity associated with Enron and related scandals. On the contrary, tests reveal that firms with an established reputation for superior investor relations activities fared worse on a series of market-related factors. Results suggest that distrust in corporate reporting practices spilled over to investor relations practices, and that best practice investor relations programmes developed during normal market conditions offered little protection from systemic declines in investor confidence arising from the corporate misdeeds of other firms.

U2 - 10.1080/00014788.2011.549638

DO - 10.1080/00014788.2011.549638

M3 - Journal article

VL - 41

SP - 67

EP - 90

JO - Accounting and Business Research

JF - Accounting and Business Research

SN - 0001-4788

IS - 1

ER -