Executive Tweets, 2020

Background: Distibutions of litigation risk and executive characteristics, split on if the executive (CEO or CFO) is on Twitter.

Abstract: We examine the tweeting behavior of S&P 1500 firms’ executives (CEOs and CFOs) on Twitter and its consequences. We find that following the release of the U.S. Securities and Exchange Commission’s 2013 report on social media usage by corporations and executives, executives from firms with high litigation risk are less likely to join Twitter. We also document that executives tweet financial information related to their firms and time these tweets to firms’ major financial and non-financial events, and that investors respond to executive tweets in addition to firm tweets. Using an innovative construct measuring the content similarity between executive tweets and firm tweets, we find evidence consistent with the view that investors trust similar information from executive Twitter accounts more than information from firm Twitter accounts.

A copy of the paper will be available at SSRN soon.

A presentation on this paper is available at this link