Two credibility-enhancing tactics of Twitter disclosure : retweeting and mentioning

Abstract

An important managerial concern is how to enhance disclosure credibility, especially for qualitative positive disclosures. This study examines two credibility-enhancing tactics that managers adopt when they use Twitter as a disclosure platform. The first tactic involves a manager retweeting a corporate disclosure tweet in his/her personal account (hereafter, retweeting). I propose that retweeting increases disclosure credibility to a greater extent than non-retweeting, as it establishes a closer association between the manager and message. The second tactic is to mention any involved parties in the corporate disclosure tweet when those parties have verified Twitter accounts (hereafter, mentioning). Mentioning increases the social presence of the involved parties, as they receive real-time notifications about the tweet in their Mentions tabs, and other users can observe the interactions between the disclosing corporate and mentioned parties in real time. I predict that the higher social presence of an involved party resulting from mentioning increases disclosure credibility compared with non-mentioning. I also predict that the effect of mentioning dominates that of retweeting when both credibility-enhancing tactics are used. I conduct an experiment to test my predictions, and the results support my hypotheses. This study contributes to our understanding of how some Twitter functions influence corporate disclosure credibility and provides important implications for preparers and users of financial disclosures.