Precision and Perception: Analyzing the Credibility in ESG Disclosures
Abstract:
This research investigates the effect of time-horizon precision on the perceived credibility of Environmental, Social, and Governance (ESG) disclosures. We examine whether clear and specific timelines in disclosures can enhance confidence in the report and identify specific groups of individuals for whom this precision is most impactful. Using a quasi-experimental design within a survey, participants were randomly assigned to one of two groups: a treatment group that received an ESG text fragment with precise time horizon details, and a control group for which the text fragment did not specify a forecast horizon. The established Perceived Credibility (PERCRED) scale is employed to capture participants’ assessments of the disclosures. Our findings reveal that the effectiveness of time-horizon precision is contingent upon the reader’s familiarity with ESG or firm reporting, as significant positive effects were observed among subgroups familiar with ESG or firm reporting. This research contributes to the discourse on ESG reporting by demonstrating the role of precision in influencing readers perceptions and the strategic importance of transparent reporting practices.
Language: English
This is a free seminar. Registration is mandatory.