Research On The Influence Of Economic Policy Uncertainty On The Tone Choice Of Annual Report

Economic policy uncertainty is an inevitable external risk in the survival and development of enterprises.With the rapid development of economy and the intensification of competition,the policy uncertainty caused by adaptive policy adjustment has become the norm.The uncertainty of economic policy will have many effects on the production and operation of enterprises and information disclosure.The changes in operation and information environment caused by the uncertainty of economic policy may lead to the adverse judgment of information users on listed companies,and the text intonation can improve the cognition of information users and affect their economic decision-making.Therefore,the management of the company may hope to improve the cognition of information users to the company by selecting the tone of the annual report,so as to reduce the impact of economic policy uncertainty.Therefore,the uncertainty of economic policy may lead the management to choose the disclosure form of tone in the annual report.This paper focuses on the perspective of economic policy uncertainty and the tone choice of management’s annual report,and studies the relationship between economic policy uncertainty and the tone choice of annual report.The results show that:(1)there is a positive relationship between economic policy uncertainty and the tone of annual reports of listed companies.After a series of robustness tests,the benchmark conclusion has not changed.(2)The research on the action mechanism shows that there are business channels,information channels and investor sentiment channels between the uncertainty of economic policy and the tone of the annual report,that is,the business channels show that the uncertainty of economic policy leads to the increase of enterprise business uncertainty,and the management adopts a positive narrative framework in the disclosure of the annual report,which further promotes the tone of the annual report to a positive direction;The information channel shows that the uncertainty of economic policy intensifies the degree of information uncertainty.The management selectively discloses the tone of the annual report based on the information advantage of insiders,which promotes the increase of the enthusiasm of the tone of the annual report;The investor sentiment channel shows that the uncertainty of economic policy suppresses investor sentiment.In order to improve investor confidence and attract investors’ attention,the management improves the tone of the annual report.(3)The further research part finds that: firstly,the positive relationship between economic policy uncertainty and the tone of the annual report is more significant in private enterprises,non-governmental protection industries and areas with strong speculative preference;Secondly,the research based on the reliability of annual report intonation shows that the motivation of managers to choose positive annual report intonation in the face of economic policy uncertainty is mainly reflected in "impression management motivation";Finally,based on the economic consequences of the management’s choice of annual report tone under the uncertainty of economic policy,the study found that when the uncertainty of economic policy is high,the management’s choice of positive annual report tone intensifies the risk of stock price collapse and excessive compensation of management in the future.The research conclusion of this paper enriches the research on the impact of economic policy uncertainty on the behavior choice of micro subjects,and provides empirical evidence for information users to understand the tone of the annual report in combination with the change of policy environment.