Impression Management Tactics in the Chairperson’s Statement: A Systematic Literature Review and Avenues for Future Research

Abstract

The chairperson’s statement (CS) has evolved into a key component of corporate reporting, offering an authoritative, high-level summary of a company’s activities, initiatives, operations, financial performance, and achievements over the preceding financial year, along with insights into future outlooks. Recognised for its informative value, the CS is consistently ranked by stakeholders as the most read and most influential section of the integrated report. Despite its importance, the CS is also a platform where corporate management often engages in impression management (IM) to portray a biased and overly positive image of the company. This study conducted a systematic literature review to examine the IM tactics employed within the CS. Based on the findings, an integrative conceptual framework was developed. Identified IM tactics include readability, textual characteristics, the influence of culture, legal systems and capital markets, paratext and intertextuality, the tone of language, forward-looking statements, retrospective sense-making, ambiguous language, the use of photographs and graphs, impersonalisation and evaluative language, and self-serving attributions. The results highlight that the study of IM strategies in CSs represents a rich and relevant research domain that warrants deeper exploration. Given its qualitative complexity and underexplored dimensions, this area offers several promising avenues for future investigation.

1. Introduction

This study examines the existing literature on IM tactics employed in the CS. Specifically, it investigates the IM strategies commonly found in CSs, as documented in the prior literature, and explores existing research gaps. This article is structured as follows: it starts with the Purpose, Background, Problem Statement, and Contribution, which encompasses the research question; these are followed by the Method, Results and an analysis, Research Gaps, and Conclusions.

1.1. Purpose

This study aims to examine IM (IM) tactics employed in the CS based on the distant literature. This is important, as IM tactics are used as an opportunistic behaviour (Yasseen et al., 2017), to change the perception of the users (Tregidga et al., 2012), and to gain future benefits (Jaworska & Bucior, 2020). Considering that IM tactics are used in the CS, which is a significant statement in an integrated report as it gives a company overview (Clatworthy & Jones, 2006) and provides the company’s strategic information (Mankayi et al., 2023), it warrants an investigation to unearth how this contentious issue of impression management has evolved over the years. Lastly, this study seeks to design an integrative conceptual model.

1.2. Background

IM is defined as the process by which firms construct and maintain an image as perceived by stakeholders to gain future benefits (Jaworska & Bucior, 2020). It involves the deliberate introduction of bias into narrative disclosures by managers to manipulate the appearance and content of corporate reporting. Tregidga et al. (2012) describe IM in corporate reporting as a form of positive reporting bias, where the goal is to shape the interpretation and understanding of information. The IM literature asserts that “managers opportunistically exploit information asymmetries between them and organisational audiences using biased reporting” (Brennan & Merkl-Davies, 2013). Essentially, IM entails the strategic selection, presentation, and structuring of narrative content to emphasise success and to obscure failure, thereby influencing stakeholder perception. This phenomenon is widely acknowledged as a systematic force in shaping readers’ views of corporate performance.

The introduction of the CS marked a significant development in corporate reporting. It replaced the earlier explanatory statement of financial conditions, which shared similar narrative traits (Xiao, 1999). Also referred to as the chairman’s address or letter, the CS is an annual communication from the board chairperson to shareholders, typically included in the annual or integrated report. It provides an overview of the company’s performance over the reporting period (Clatworthy & Jones, 2006) and serves as an entry point for readers, summarising what the full report contains (Davison, 2010). Clatworthy and Jones (2006) note that the CS delivers a comprehensive view of the firm’s past, present, and projected future. Mankayi et al. (2023) emphasise that it often includes strategic information, such as market share, that can significantly influence investor decisions. The CS is consistently ranked as the most read and most influential narrative section in the integrated report (Yasseen et al., 2017; Stainbank & Peebles, 2006; Courtis, 2004).

Characteristically, the CS is an authoritative, high-level summary of the company’s actions, initiatives, operations, financial results, and overall achievements for the financial year combined with a forward-looking perspective. Notably, it often adopts an optimistic tone. Shaw and Pecorari (2013) argue that the CS is a carefully constructed public document that appeals to a wide readership. Tregidga et al. (2012) further assert that the influence of the CS lies not just in its content but in its sentence construction, which often carries cultural and political weight. While some companies combine the CS with the CEO’s statement, this is less common in countries like South Africa, where they are usually presented separately. According to Tregidga et al. (2012), the CS rivals the CEO’s letter in importance due to the weight and authority of its message. Unlike the CEO’s statement, which is typically written and signed by the executive director responsible for operations, the CS is usually authored and signed by the board chairperson, who is an independent, non-executive director (Leventis & Weetman, 2004). However, in practice, the CS is not always written directly by the chairperson; it is often a collaborative output involving company secretaries, finance teams, and public relations departments (Beattie, 2014).

Although both the CS and CEO statements are voluntary narrative disclosures and not mandated by financial reporting standards (Mlawu et al., 2023; Yasseen et al., 2017), the CS attracts particular attention from investors (Clatworthy & Jones, 2006; Bartlett & Chandler, 1997). IM in integrated reports manifests in various forms, including the tone of language (Melloni et al., 2016; Phesa et al., 2021), the use of graphs (Cho et al., 2012; Varachia & Yasseen, 2020), and textual characteristics (Yasseen et al., 2017). A range of studies highlight the CS as a strategic tool for IM (Jugnandan & Willows, 2022; Phesa et al., 2021b; Totowa & Mokoaleli-Mokoteli, 2021; Yasseen et al., 2019, 2017; Moola, 2016; Oliveira et al., 2016; J. Wang, 2016; Brennan & Merkl-Davies, 2013; Merkl-Davies & Brennan, 2007; Smith et al., 2006; Sjovall & Talk, 2004; Smith & Taffler, 1992b, 2000).

1.3. Problem Statement

Management frequently uses the CS to convey an overly positive image of the company (Aerts, 2005; Dhludhlu et al., 2022), often focusing on successes while downplaying or ignoring failures. This undermines the intended function of the CS, which is to provide useful, transparent information to stakeholders. IM tactics distort the representation of company facts and performance, which reduces the overall quality and credibility of corporate reporting (Merkl-Davies & Brennan, 2007). Phesa et al. (2024) argue that selective and biased reporting compromises the accuracy and completeness of disclosures. When the CS is used primarily for IM, it not only diminishes reporting quality but also risks capital misallocation (Brennan & Merkl-Davies, 2013). These concerns are exacerbated by the fact that the CS is a voluntary narrative disclosure (Merkl-Davies & Koller, 2012) and is not subject to regulatory standards like the financial statements governed by International Financial Reporting Standards (Mankayi et al., 2023; Stainbank & Peebles, 2006). This regulatory gap leaves the CS more vulnerable to manipulation through IM (Clatworthy & Jones, 2003; D’Northwood, 2015).

1.4. Contribution

The study contributes by proposing an integrative conceptual model based on the IM tactics observed in CSs. Although corporate reporting scholars have long explored IM in CSs (e.g., Clatworthy & Jones, 2006; Brennan & Merkl-Davies, 2013; Yasseen et al., 2017; Stainbank & Peebles, 2006; Courtis, 2004), limited research has examined these tactics from a broader comparative literature base. This study addresses this gap and further develops a conceptual framework that enhances the understanding of IM practices within the CS.

The central research question guiding this investigation is as follows: What IM tactics have been identified in the CS by the extant literature? To address this question, we conduct a systematic literature review (SLR) and subsequently develop an integrative conceptual framework that synthesises the IM strategies identified in the CS. This study is significant because the CS is a key corporate communication tool used to shape stakeholder perceptions, making it one of the most frequently analysed narrative disclosures in the existing literature (Moreno et al., 2019).

An SLR is selected due to its structured, comprehensive, and methodologically rigorous approach (Tranfield et al., 2003). It enhances research quality, reduces bias, supports transparency and reproducibility, and enables a thorough and evidence-based response to the research question (Fisch & Block, 2018). Furthermore, an SLR facilitates the identification of all relevant studies that meet predefined inclusion criteria, with the primary aim of extracting, evaluating, and integrating reliable information related to the research topic (Snyder, 2019; vom Brocke et al., 2015). To the best of the authors’ knowledge, this is the first SLR specifically focused on IM tactics within the CS, marking a novel contribution to the field.

2. Method

We use an SLR methodological framework to conduct this study. A systematic literature review (SLR) enables researchers to answer a clearly defined research question by identifying and synthesising all relevant empirical evidence based on predefined inclusion criteria (Snyder, 2019). SLRs serve as a critical method for managing information related to specific academic inquiries in a transparent, traceable, and reproducible manner (Tranfield et al., 2003; Hiebl, 2023; Cram et al., 2020; Fisch & Block, 2018; Templier & Paré, 2018; Gimbar et al., 2016). An SLR provides evidence based insights (Parris & Peachey, 2013) that are clearly defined and accessible to the reader (Cooper et al., 2018), and they help reduce bias in the review process (Snyder, 2019). To examine IM strategies used in the CS, this study adopts the SLR approach proposed by Tranfield et al. (2003) and subsequently refined by Hansen and Schaltegger (2016). This approach involves six sequential stages: (i) research selection; (ii) formulation of inclusion and exclusion criteria; (iii) identification of relevant studies; (iv) assessment of study quality; (v) data extraction; and (vi) synthesis of findings. To further enhance the methodological rigor of this review, we applied the best practice guidelines for SLRs in management and business research as outlined by Clark et al. (2021) and Fisch and Block (2018). Nevertheless, we acknowledge that SLRs also have inherent limitations, such as language bias and constraints stemming from the inclusion and exclusion criteria (Aromataris & Pearson, 2014).

2.1. Stage 1: Selection of Research

Based on the research question, we identified relevant keywords to guide our search strategy. These initial keywords included the following: “IM”, “chairperson’s report”, “CS”, “chairman’s statement”, “discretionary narratives”, and “corporate annual reports”. These terms formed the basis for constructing the preliminary search strings. To refine these search terms, a pilot test was conducted in which ten papers were retrieved using Google and allocated to pairs of team members for review. From this pilot test, four additional keywords were identified: “chairperson’s letter”, “corporate disclosures”, “accounting narratives”, and “chairman’s letter”. The search terms were then iteratively revised and optimised based on the pilot results.

The final search terms used to locate studies relevant to the research topic were as follows: “IM in chairman’s/chairperson’s report/statement/letter” and “IM in discretionary narratives/corporate annual reports/corporate disclosures/accounting narratives”. We excluded terms such as “director’s report”, “greenwashing”, and “safewashing” because they did not accurately align with the scope of this study. Specifically, greenwashing refers to the misrepresentation of environmental practices, and safewashing involves the securitisation of occupational health and safety disclosures, both of which fall outside the specific focus on IM in the CS.

The literature search was conducted in April and May 2023 and again in September 2024 across the following databases: Google Scholar, ScienceDirect, Google, and Scopus. Google and Google Scholar were included to capture a wide array of the relevant literature. These platforms are among the largest research databases globally, particularly for accessing peer-reviewed academic studies (Chim-Miki et al., 2024; Matenda et al., 2023; Plotkina & Sri Ramalu, 2024). They provide access to leading scholarly journals, helping to ensure comprehensive inclusion of relevant sources (Brocke et al., 2009; Strauss et al., 2024). Articles were collected from all listed databases to ensure repeatability, consistency, reliability, and overall research quality (Matenda et al., 2021; Stenbacka, 2001). Sourcing studies from multiple databases is considered a best practice (Weiss & Kanbach, 2022), as it enhances triangulation (Matenda et al., 2023), minimises source bias (Matenda et al., 2021; Schlosser, 2007), and helps mitigate geographic bias (Alaka et al., 2018; Matenda et al., 2021). We restricted the search to studies published in English in peer-reviewed journals or conference proceedings from 1980 through September 2024. The year 1980 was selected as the starting point because scholarly interest in corporate narrative documents as vehicles for IM began to gain traction during the early 1980s.

2.2. Stage 2: Design of Inclusion and Exclusion Criteria

Only peer-reviewed journal articles and conference proceedings written in English and focused specifically on the analysis of IM in the CS of profit-oriented organisations were included in this review. We excluded books, book chapters, editorials, reviews, and lecture notes due to concerns regarding the absence, unreliability, or lack of transparency in their peer-review processes (Moritz et al., 2024; Sassmannshausen & Volkmann, 2018). We acknowledge the potential bias introduced by the inclusion and exclusion criteria, as highlighted by Nightingale (2009), and recognise the associated risk of omitting relevant studies by excluding books, theses, dissertations, and grey literature. However, the strict selection criteria were applied to uphold the methodological quality and reliability of the findings. Furthermore, the decision to include only English-language articles was based on two considerations: the desire to make the reviewed literature accessible to an English-speaking academic audience, and the lack of financial resources for professional translation services. The scope of this review encompasses studies published between 1980 and September 2024, aligning with the emergence of and growing scholarly attention to IM practices in corporate narrative disclosures during this period.

2.3. Stage 3: Study Identification

Our search efforts yielded a substantial number of articles, though not all were relevant to the focus of this study. To efficiently manage time and avoid unnecessary expenditure on acquiring unsuitable sources, we initially screened the titles and abstracts of the retrieved studies to assess their relevance. A data extraction sheet was used to document and guide this preliminary screening process. In cases where the title and abstract did not provide sufficient information to make an inclusion decision, the introduction and/or conclusion of the study was reviewed. If ambiguity remained, a full-text review was conducted to determine the study’s suitability for inclusion in the analysis.

2.4. Stage 4: Study Quality Examination

To ensure the validity and reliability of the research outcomes, only peer-reviewed journal articles and conference proceedings were included in this study. Peer-reviewed publications are widely recognised for their academic rigor and are generally considered to represent high-quality research (Böckel et al., 2021; Schlosser, 2007). Non-peer-reviewed papers, master’s and doctoral dissertations, and grey literature were excluded from the review. All articles that passed the initial title and abstract screening were collected for full-text examination. In cases where full-text access was restricted, efforts were made to contact the authors’ affiliated institutions or the publishing journals to obtain the necessary documents. Following the removal of duplicates, inaccessible sources, and studies that did not meet the inclusion criteria, a total of sixty-seven articles were included in the final review. While this number may appear modest, particularly given the growing body of research on IM, it is important to note that many studies focused on IM in other forms of narrative disclosure, such as CEO letters, rather than the CS specifically. A PRISMA flow diagram (Figure 1 below) illustrates the article selection process.

Based on the PRISMA framework, a total of 518 studies were initially identified from online databases using the relevant keywords outlined in Stage 1 of the review process. During the initial screening of titles, 391 documents were excluded as they were not relevant to the research topic. Additionally, duplicate records resulting from searches across multiple databases were identified and removed. This initial filtering process left 127 documents, which were then subjected to a more detailed screening based on their titles, abstracts, and conclusions. At this stage, 57 studies were excluded because they did not focus on IM in the CS. This left 70 potentially relevant studies. However, 3 additional documents were subsequently removed due to lack of access to the full text, resulting in a final sample of 67 studies included in the review. We acknowledge the bias towards identified studies due to inclusion and exclusion criteria.

2.5. Stage 5: Extraction of Data

Data were extracted by the authors and recorded using an integrated data extraction sheet developed in Microsoft Excel. The following key details were captured for each study: author(s), year of publication, title, study objectives, name of the journal or academic conference proceedings, quality (ranking in Scopus), and main findings. These elements were essential for synthesising the data and addressing the research question effectively. To ensure rigor and reliability in the review process, a two-person research team independently analysed each article. Research team pairings were rotated regularly to minimise bias arising from the same individuals consistently working together (Matenda et al., 2023). Any disagreements between reviewers were resolved through discussion among the authors. Additionally, the authors maintained complementary notes to document key insights and observations, thereby ensuring that all relevant information was comprehensively captured (Matenda et al., 2023).

2.6. Stage 6: Synthesis of Data

Data were synthesised using tables and graphs, with a descriptive analytical method employed to address the research question. Key findings were summarised, and gaps in the literature were identified based on the results. Evidence from the reviewed studies, along with additional sources, was used to support the discussion of key issues and debates.

3. Results

This section provides a descriptive analysis of the identified and reviewed literature, IM tactics, and research gaps discovered.

Descriptive Analysis of the Identified and Reviewed Literature

Table 1. Summary of the reviewed studies.

Author(s) (Publication Year)	Title of the Article	Name of the Journal/Conference Proceedings	Quality of the Journal (Scopus)	Results
Jones (1988)	A longitudinal study of the readability of the chairman’s narratives in the corporate reports of a UK company	Accounting and Business Research	Q2	Corporate reports are challenging to read and have become more challenging to read over time.
Smith and Taffler (1992a)	The chairman’s statement and corporate financial performance	Accounting and Finance	Q1	There is a correlation between readability of the chairperson’s narrative and financial performance and distinct performance measures, whilst poor readability is related to poor financial performance.
Smith and Taffler (1992b)	Readability and understandability: different measures of the textual complexity of accounting narrative	Accounting, Auditing and Accountability Journal	Q1	Understandability and readability are dissimilar notions. Standards designers must focus on “understandability” as a wanted feature of accounting disclosures.
Courtis (1998)	Annual report readability variability: tests of the obfuscation hypothesis	Accounting, Auditing and Accountability Journal	Q1	Discernible reading-ease patterns exist. Obfuscation is associated with firms with high financial press coverage.
Smith and Taffler (2000)	The CS—a content analysis of discretionary narrative disclosures	Accounting, Auditing and Accountability Journal	Q1	CSs are closely related to financial performance, supporting the claim that such unaudited disclosures encompass significant information.
Clatworthy and Jones (2001)	The effect of thematic structure on the variability of annual report readability	Accounting, Auditing and Accountability Journal	Q1	The CS’s introduction is easier to read than other portions of the CS. The CS’s thematic structure is an essential determinant of annual report readability variability.
Courtis and Hassan (2002)	Reading ease of bilingual annual reports	The Journal of Business Communication	N/A	Indigenous language versions are more straightforward to read than English-written ones. Dissimilar language versions produce dissimilar reading behaviour and can have resource distribution decision-making inferences.
Davison (2002)	Communication and antithesis in corporate annual reports: a research note	Accounting, Auditing and Accountability Journal	Q1	The visual and textual material offers a wider context by merging instants from world and corporate history with the bulletin of corporate developments and recent matters.
Sydserff and Weetman (2002)	Developments in content analysis: a transitivity index and DICTION scores	Accounting, Auditing and Accountability Journal	Q1	Differentiation results between poor performers and good performers are mixed. There is evidence of IM.
Courtis (2004)	Corporate report obfuscation: artefact or phenomenon?	The British Accounting Review	N/A	Reading is complex, and variability is pervasive.
Clatworthy and Jones (2003)	Financial reporting of good news and bad news: evidence from accounting narratives	Accounting and Business Research	Q2	Firms underscore the positive characteristics of their performance. Firms seize credit for good news themselves, condemning the external atmosphere for bad news.
Beynon et al. (2004)	The prediction of profitability using accounting narratives: a variable-precision rough set approach	Intelligent Systems in Accounting, Finance and Management: International Journal	Q2	Most informative is the percentage of good news words, lousy news words, and positive keywords.
Clatworthy and Jones (2006)	Differential patterns of textual characteristics and company performance in the chairperson’s statement	Accounting, Auditing and Accountability Journal	Q1	The CS is exposed to IM tactics as managers’ inclination to relate themselves to the firm financial results is related to the firm’s financial performance. Firms that are not profitable focus more on the future instead of past performance.
de Groot et al. (2006)	A corpus analysis of text themes and photographic themes in managerial forewords of Dutch-English and British annual general reports	IEEE Transactions on Professional Communication	N/A	Substantial thematic disparities exist between the Dutch–English CEO’s statements, the British CEO’s statements, and the British CS. These differences may be accredited to communicative and historical arrangements and recent affairs in a specific business environment.
Smith et al. (2006)	The chairman’s statement in Malaysian companies: a test of the obfuscation hypothesis	Asian Review of Accounting	Q2	There are substantial associations between financial performance and corporate language.
Merkl-Davies and Brennan (2007)	Discretionary disclosure strategies in corporate narratives: incremental information or IM?	Journal of Accounting Literature	Q3	Firm narrative documents are viewed as conduits for manipulating the verdicts and insights of external parties concerning corporate prospects and performance.
Beattie et al. (2008)	Investigating presentational change in UK annual reports: a longitudinal perspective	The Journal of Business Communication	N/A	IM via graphical measurement distortion, selectivity, and manipulation of the length of time series graphs is widespread.
Davison (2008)	Rhetoric, repetition, reporting and the “dot.com” era: words, pictures, intangibles	Accounting, Auditing and Accountability Journal	Q1	Repetition highlights BT plc’s intangible assets; less intentionally, repetition indicates BT plc’s corporate uniqueness and its partaking in the “dot.com” era.
Bhana (2009)	The chairperson’s statements and annual reports: are they reporting the same company performance to investors?	Investment Analysts Journal	Q3	Firms highpoint the positive facets of their performance. Companies seize credit for good news while condemning the external atmosphere for bad news.
Mir et al. (2009)	Culture and corporate voluntary reporting: a comparative exploration of the chairperson’s report in India and New Zealand	Managerial Auditing Journal	Q1	Conflicting with suggestions premised on Hofstede’s cultural framework, Indian firms offer more disclosure in their chairperson’s reports than New Zealand firms.
Davison (2011)	Paratextual framing of the annual report: liminal literary conventions and visual devices	Critical Perspectives on Accounting	Q1	Narrative and visual components of the annual report (physical format, names, authorship, titles, epigraphs, prefaces (introduction/CS) and intertitles) frame the reception of the text.
Merkl-Davies et al. (2011)	IM and retrospective sense-making in corporate narratives: a social psychology perspective	Accounting, Auditing and Accountability Journal	Q1	Negative firm results stimulate managers to participate in retrospective sense-making instead of giving a picture of firm performance conflicting with the opinion.
Smith et al. (2011)	The predictive ability of corporate narrative disclosures: Australian evidence	Asian Review of Accounting	Q2	Word-based variables premised on discretionary disclosures are considerably associated with corporate performance.
Talha and Salim (2011)	Chairman statement characteristics and firms performance: a study of Malaysian construction companies	International Journal of Managerial and Financial Accounting	Q3	No substantial differences between profitable and unprofitable firms besides the fact that profitable firms have a habit of presenting more graphs and pictures in the CS segment while presenting their bottom-line performance.
Bayerlein and Davidson (2012)	The influence of connotation on readability and obfuscation in Australian chairman addresses	Managerial Auditing Journal	Q1	Mid-segment of the CSs was substantially more challenging to read than the first and last segments.
Merkl-Davies and Koller (2012)	‘Metaphoring’ people out of this world: a critical discourse analysis of a chairman’s statement of a UK defence firm	Accounting Forum	Q1	Impersonalisation and evaluation are intentionally utilised to direct organisational audiences’ interpretations of financial success as well as to legitimise and normalise violence and devastation by abstracting and sanitising its representation.
H. Wang et al. (2012)	Lexical features in corporate annual reports: a corpus-based study	European Journal of Business and Social Sciences	N/A	Vocabulary of the CSs is the richest, whereas that of the auditor’s report is not rich. In auditor’s and corporate social responsibility reports, words are lengthier and more sophisticated than those in financial and CSs.
Cen and Cai (2013)	‘IM’ in Chinese corporations: a study of chairperson‘s statements from the most and least profitable Chinese companies	Asia Pacific Business Review	Q2	IM drives and inspires CSs in the Chinese environment in several ways.
Craig et al. (2013)	Exploring top management language for signals of possible deception: the words of Satyam’s chair Ramalinga Raju	Journal of Business Ethics	Q1	Raju’s selection of words was transformed strikingly in his five yearly report communications before Satyam’s failure as the degree and effect of his financial misstatements amplified.
Shaw and Pecorari (2013)	Types of intertextuality in CSs	Nordic Journal of English Studies	Q1	Production format for the texts shows signs of templates and repetition. They are frequent and appear in all thematic units.
Athanasakou and Hussainey (2014)	The perceived credibility of forward-looking performance disclosures	Accounting and Business Research	Q2	Firms release more forward-looking performance disclosures (FLPDs) when soliciting debt or transmitting bad news in the financial statements.
Cen and Cai (2014)	Preference in presentation or IM: a comparison study between chairmen’s statements of the most and least profitable Australian companies	Australasian Accounting, Business and Finance	Q2	Chairperson’s letters from profitable and non-profitable Australian firms show diverse presentational preferences.
Cooper and Slack (2015)	Reporting practice, IM and company performance: a longitudinal and comparative analysis of water leakage disclosure	Accounting and Business Research	Q2	The nature, level, and appearance of a sewerage and water firm’s leakage disclosures vary distinctly depending on their performance against the Water Services Regulation Authority’s target.
D’Northwood (2015)	A comparative linguistic analysis of statements by the chairperson and chief executive officer (CEO) in BP plc’s published annual report of 2010	British Accounting and Finance Association Financial Reporting and Business Communication, Nineteenth Annual Conference	N/A	Readers’ observations are moulded by the CSs and CEO statements of BP plc in the firm’s 2010 annual report. However, resemblances and disparities are evident in how this positioning is engineered. Resemblances and disparities are not restricted to BP plc.
Oliveira et al. (2016)	IM and self-presentation dissimulation in Portuguese chairmen’s statements	Corporate Communications	Q2	Implementation of IM strategies is unaffected by organisational results. Critical elements in describing them are consumer proximity and public visibility.
Mahboub et al. (2016)	IM in chairmen’s letters: an empirical study of banks’ annual reports in MENA region	Corporate Board: Role, Duties and Composition	N/A	IM strategies in the chairperson’s letters: reading-ease manipulation, performance comparisons, structural and visual manipulation, and performance attribution. Annual report narrative is complicated to read. Yardsticks that depict present bank performance in the best imaginable light are chosen.
Mmako (2016)	The chairperson’s statement: understanding prioritisation of discretionary disclosures by Johannesburg Security Exchange listed companies	Journal of Contemporary Management	Q1	Significant variances between the CSs of poor-performing and high-performing firms were the weight put on issues like devotion to corporate governance. High-performing firms could better deal with most content essentials of an integrated report in their CS and the proactive and reactive reactions to the firms’ performance.
Yasseen et al. (2017)	A preliminary study into IM practices in chairperson’s statements in South African annual reports: an attribution theory perspective	Communicare: Journal for Communication Studies in Africa	N/A	IM exists in the CSs of the JSE main board listed firms. “Extremely unprofitable” firms are less expected to use IM.
Gitahi et al. (2018)	Relationship between the CS and the value relevance of annual reports for listed banks in Kenya	Scientific Research Journal	N/A	The CS was positively and significantly connected to the value relevance of annual reports.
Vogel (2018)	Persuasion in business documents: strategies for reporting positively on negative phenomena	Ostrava Journal of English Philology	Q3	Ten approaches have been recognised, fitting into two big clusters (i.e., facing problems vs. relativising problems).
Ahmed and Salat (2019)	A thematic analysis of chairman’s statement of the commercial banks of Bangladesh	Barishal University Journal (Part-3)	N/A	Banks highlight the positive facets of their performance while accusing the external environment of bad reports. Consequently, IM practices were apparent.
Cleary et al. (2019)	Socioemotional wealth in family firms: a longitudinal content analysis of corporate disclosures	Journal of Family Business Strategy	Q1	CS does contain FIBER dimensions (“Family control and influence, Identification of family members with the firm, Binding social ties, Emotional attachment of family members, and Renewal of family bonds to the firm through dynastic succession”), and they do alter over time.
Fisher et al. (2019)	Tone and the accounting narrative	Hawaii Accounting Research Conference	N/A	Chairperson’s and corporate social responsibility opening letters display high optimism, positivity, and realism. Readability throughout all disclosure kinds was “very difficult”.
Man et al. (2019)	Chairman’s statement of a Malaysian public university: a critical discourse analysis	International Journal of Accounting, Finance and Business	N/A	Management strategically employs linguistic and semiotic strategies to meet several economic and political objectives and aims.
Moreno et al. (2019)	A longitudinal study of the textual characteristics in the chairman’s statements of Guinness: an IM perspective	Accounting, Auditing and Accountability Journal	Q1	Guinness constantly employed qualitative textual features with a self-centred bias. Nevertheless, Guinness did not employ those with a more quantitative nature.
Yasseen et al. (2019)	The use of IM practices in the chairperson’s statements in South African annual reports: an agency theory perspective	Communicare: Journal for Communication Studies in Africa	N/A	Managers use IM strategies that are contingent on the firm’s performance. Readability variability was not implemented as a strategy to handle impressions. The CS was mainly challenging to understand.
Al-Sayani et al. (2020)	The influence of audit committee characteristics on IM in chairman statement: evidence from Malaysia	Cogent Business and Management	Q2	Audit Committee (AC) independence is adversely related to the IM level measured, premised on quantitative and qualitative scores. AC meetings are positively related to the IM level, premised on qualitative scores.
Huang and Wang (2020)	A CGA-based study on translation characteristics of chairman speeches in company annual reports	Journal of Literature and Art Studies	N/A	Chairperson speeches comprise particular move structures and explicit communication aims, with industry atmosphere and self-interest contribution strongly affecting the rhetorical selections and wording of the chairperson speeches, and this can be elucidated as follows: the interactivity generates an interdiscursive association between business genre society and industry routine.
Phesa et al. (2021)	IM examination in chairpersons’ statements in the top 40 JSE-listed companies	Mbali Conference 2021 Proceedings	N/A	Top 40 JSE-listed firms participate in IM. Unprofitable firms implemented more personal references than profitable firms, while profitable firms implemented more positive sentiments than unprofitable firms.
Rosa and Kawshalya (2022)	Differential patterns of textual characteristics in the CS and company performance: evidence from Sri Lanka	International Journal of Accountancy	N/A	Corporation’s performance substantially influences the content of the CS.
Totowa and Mokoaleli-Mokoteli (2021)	Chairman’s letter, IM and governance mechanisms: a case of South African listed firms	African Finance Journal	Q4	Managers employ mainly optimistic language in the chairperson’s letter to generate an impression regarding their corporates. This optimistic language is less employed by poorly performing corporates.
Dhludhlu et al. (2022)	IM during the COVID-19 pandemic: a comparative analysis of the CS by JSE-listed profitable and least profitable companies	Journal of Accounting and Finance in Emerging Economies	N/A	Least profitable and profitable top 100 JSE-listed firms employed IM throughout the pandemic. Firms employed passive voice and personal, future, and quantitative references in the CS. No substantial differences in quantitative references, readability, passive voice, length, personal references, and future references between these two groups of firms.
Moreno and Jones (2022)	IM in corporate annual reports during the global financial crisis	European Management Journal	Q1	No proof exists that IM was used during the global financial crisis. Businesses strived not to employ obvious IM and, to a certain degree, stated how a crisis has affected their performance. Businesses used optimistic attributions, praise benchmarks, and improvement techniques.
Nel et al. (2022)	The association between optimism and future performance: evidence of IM from chief executive officer and chairperson letters	South African Journal of Business Management	Q3	CSs were more optimistic than CEO statements. There was evidence of IM in both CSs.
Phesa and Sibanda (2022)	Manifestation of IM in corporate reporting in JSE top 40 listed companies	Journal of Business and Social Review in Emerging Economies	N/A	Profitable and unprofitable firms employed self-attribution bias. No substantial differences exist even though profitable firms employ more self-attribution than unprofitable firms.
Vivian and Mei (2022)	Move structuring and metadiscourse strategies in public listed companies’ chairperson statements	LSP International Journal	N/A	Schematic structuring of CSs is dissimilar from the prior structuring models with four novel moves. Variances were discovered in the distribution of interactive and interactional markers throughout the moves.
Yee and Cheong (2022)	Socio-cognitive and professional practice perspectives on chairperson statements	Journal of Modern Languages	N/A	Three informational moves are implemented to help investment verdicts, whereas seven non-informational moves are envisioned to promote a good image and goodwill and to guarantee adherence to prerequisites. CSs are promotional, interdiscursively informational, and public relational.
Al-Sayani and Al-Matari (2023)	Corporate governance characteristics and IM in financial statements. A further analysis. Malaysian evidence	Cogent Social Sciences	Q2	Board of directors characteristics have a substantial relationship with IM. Features of board chairperson, audit committee, and ownership structure significantly influence IM. The effectiveness of the board of directors and chairperson has a substantial effect on IM.
Al Lawati et al. (2023)	Forward-looking disclosure tone in the chairman’s statement: obfuscation or truthful explanations	International Journal of Accounting and Information Management	Q1	Good-performing corporates reveal more good news, whereas poor ones reveal more bad news.
Callagher and Garnevska (2023)	Multistakeholder IM tactics and sustainable development intentions in agri-food co-operatives	Journal of Management and Organization	Q1	Three themes were revealed: (i) a commonness of impression statements that offer accounts or make justifications concerning the People and Profit themes, (ii) escalating impressions regarding affairs for the Planet ensuing Sustainable Development Goals endorsement, and (iii) escalating impressions of integrative conceptions by several co-operatives.
Mankayi et al. (2023)	An analysis of the readability of the CS in South Africa	Risks	Q2	It is difficult to read the CSs for the chosen firms.
Phesa and Sibanda (2023)	IM in voluntary narrative disclosure through length and tone, stakeholder theory lens	Journal of Accounting and Finance in Emerging Economies	N/A	Profitable and unprofitable corporates employ IM via the CS length and positive tone.
Cherry et al. (2023)	Using FinBERT as a refined approach to measuring IM in corporate reports during a crisis	Communicare: Journal for Communication Sciences in Southern Africa	N/A	No general configuration of communication appeared in the CSs.
Phesa et al. (2023)	JSE delisted companies’ use of IM practices in the chairman’s statement and audit committee report preceding delisting from the 2016–2021 period	International Journal of Environmental, Sustainability, and Social Science	N/A	Delisted firms employed IM prior to delisting.
Gutiérrez Ponce et al. (2024)	The moderating effect of corporate governance on the readability of the chairman’s statement: an analysis of Jordanian listed companies	Environment, Development and Sustainability	Q1	Corporate governance substantially moderates the readability of the CS and the corporation’s performance. There is an association between the CS readability and features of the board like directors’ accounting know-how, independence, and board’s ownership concentration.
Herenia et al. (2024)	Does corporate governance influence the readability of the report by the chairman of the board of directors? The case of Jordanian listed companies	Corporate Social Responsibility and Environmental Management	Q1	Corporate governance moderates the president’s statement readability and the corporation’s performance. There is a connection between the CS readability and the accounting experience of directors.
Shaikh et al. (2024)	Integrated reports of IM techniques of the South African state-owned enterprises	Journal of Public Administration	Q2	State-owned enterprises implement IM tactics in their integrated reports.

below summarises all the articles reviewed in this study. Even though the examination of IM in discretionary narrative disclosures started in the early 1980s, the review highlighted that research related to the evolution of IM in the CS commenced in the late 1980s.

As shown in Table 1 above, out of the 67 studies reviewed, 64 are articles published in peer-reviewed journals. Regarding the quality of these articles, 70% come from ranked peer-reviewed journals (Q1: 39%, Q2: 22%, Q3: 8%, Q4: 2%), while the remaining 30% are from non-ranked journals. This indicates a publication trend on IM in the CS in quality journals. Overall, 96% of the studies reviewed are peer-reviewed journal articles, with the remaining 4% representing selected conference proceedings, valued for their novelty. The quality of the results is further illustrated in Figure 2 below.

Figure 3 below illustrates the distribution of reviewed articles by year of publication. Over 50% of the studies were published in the past ten years, indicating a growing research interest in IM in the CS. Of the 67 articles reviewed, 3 were conference proceedings. Additionally, more than 70% of the articles employed a quantitative research approach. Notably, 10 out of the 66 journal articles were published in the Accounting, Auditing and Accountability Journal.

4. IM Tactics

This section describes the IM tactics employed in the creation of the CS. The results are based on themes (tactics) that were identified through the literature review. This section explores these themes and provides a discussion of previous research from the existing literature.

4.1. Readability

Readability has long been recognised as one of the key IM tactics used in the generation of the CS (Smith & Taffler, 1992b; Jones, 1988; Mankayi et al., 2023; Gutiérrez Ponce et al., 2024). Since the CS is the most frequently read segment of annual reports, management often manipulates its readability to influence stakeholders’ perceptions. CSs typically show variability in readability, which is not surprising given that managers have full control over the communication of their performance. As such, it is common for managers to obscure failures and emphasise successes, in line with the obfuscation hypothesis (Mahboub et al., 2016; Smith et al., 2011; Cherry et al., 2023; Courtis, 1998, 2004; Smith & Taffler, 1992b; Herenia et al., 2024). Courtis (1998) argued that the variability in readability arises from management’s tendency to manipulate the text to make “good news” more accessible by using simpler language, while “bad news” is hidden through more complex writing. Studies reviewed in this context revealed distinct readability patterns in CSs. Courtis (1998) found that the first 100 words of a CS were the easiest to read, the middle 100 words were the most difficult, and the final segment was moderately difficult. This suggests that managers may use the middle portion of the CS to obscure negative information, employing more challenging language compared to the introduction and conclusion sections. Furthermore, Courtis (1998) noted that companies “in the public eye” or those engaging in “earnings management” often adopt this strategy as a means of manipulating readers and avoiding scrutiny. For further insights into the readability of the CS, readers are encouraged to refer to works such as Bayerlein & Davidson (2012) and Mankayi et al. (2023).

4.2. Textual Characteristics

Several authors (Dhludhlu et al., 2022; Phesa & Sibanda, 2022; Rosa & Kawshalya, 2022; Phesa et al., 2021; Moreno et al., 2019; Davison, 2008; Yasseen et al., 2019; Oliveira et al., 2016; Athanasakou & Hussainey, 2014; Cooper & Slack, 2015; Cen & Cai, 2014; Smith & Taffler, 1992b; Cen & Cai, 2013) have highlighted that management can manipulate the perspectives of users through the textual characteristics of information in the CS. Textual characteristics refer to the specific elements or features that define a piece of writing. In the case of discretionary accounting disclosures, these characteristics include the use of personal references, passive sentences, the frequency of quantitative references, the length of narratives, and the inclusion of key performance indicators. These features influence the text’s meaning, style, and effectiveness. Although some studies suggest that company performance does not influence IM (Oliveira et al., 2016), there is a general consensus that textual characteristics provide significant insight into how the CS varies according to a company’s financial performance (Rosa & Kawshalya, 2022; Phesa et al., 2023; Mmako, 2016; Yasseen et al., 2017; Gitahi et al., 2018). Cen and Cai (2014) concluded that both profitable and unprofitable companies use IM tactics but in different ways. Clatworthy and Jones (2006) suggested that management tends to be more assertive when reporting positive performance, while unprofitable firms appear more future-oriented compared to profitable ones. For further insights into textual characteristics, readers are encouraged to consult sources such as Moreno and Jones (2022), Clatworthy and Jones (2006), de Groot et al. (2006), and Beynon et al. (2004).

4.3. Culture, Legal Systems, and Capital Markets

The existing literature has highlighted that the cultural underpinnings of accounting practices serve as a significant power capital in IM. Several studies (Doupnik & Riccio, 2006; Guillamon-Saorin & Sousa, 2010) have shown that disclosures can vary between countries due to factors such as culture, legal systems, and capital markets. These factors influence both the nature and extent of information disclosed in the CS. For instance, Mir et al. (2009) found that Indian firms tend to provide more disclosure in their CSs than firms in New Zealand. However, they concluded that voluntary disclosure is a complex issue and that cultural factors alone are insufficient to fully explain the discretionary disclosure practices of a nation. This study emphasised that the opportunistic behaviours employed in voluntary narrative disclosures, regardless of the country’s context, may stem from various factors, including culture, politics, and other influences.

4.4. Paratext

The reviewed literature suggests that paratext can be used to manipulate the users of the CS (Davison, 2011). The term paratext was coined by Genette in 1997 to describe the elements that frame a text, which he referred to as the “fringe of the text” that ultimately controls the reader’s interpretation of the text (Lejeune, 1975). Following this, Genette (1997) argued that paratext serves as a means for a text to become a book and to be presented to its readers and, more broadly, to the public. Paratext includes all the visible—yet often overlooked—visual and narrative components of a text that provide subtle cues, such as its physical format, titles, authorship, epigraphs, and intertitles (Davison, 2011). Genette (1997) further suggested that paratext represents a strategic threshold, a zone of interaction between the sender and the receiver of the message. Similarly, Skare (2021) posited that a paratext is a text that mediates between the main work and its audience, thereby enabling the work to be complete and offered to its readers, and more broadly, to the public.

4.5. Intertextuality

From the analysed literature, intertextuality emerged as one of the key IM strategies used in the CS (Craig et al., 2013; Shaw & Pecorari, 2013; Merkl-Davies & Koller, 2012; H. Wang et al., 2012). Intertextuality is considered one of the indexicals in the texture index, based on Roseberry’s (1995) model, which characterises seven criteria for assessing texts. Sydserff and Weetman (1999) defined intertextuality as “the factors that make the use of one narrative dependent upon the knowledge of other material”. This concept is grounded in the idea that texts are not isolated but are interrelated with other texts (Merkl-Davies et al. 2005). According to Merkl-Davies et al. (2005), these intertextual connections can include allusion, anagram, adaptation, parody, translation, pastiche, imitation, and other forms of transformation. Shaw and Pecorari (2013) explored how the careful choice of words is strategically employed in the CS. Their research highlighted the evolution of the CS over time, specifically noting how each year builds upon the previous one.

4.6. Retrospective Sense-Making

Retrospective sense-making refers to the interpretation of past events in the present (Weick, 1995). In other words, it involves managerial sense-making through the retrospective framing of organisational outcomes (Merkl-Davies et al., 2011). Similarly, Jones et al. (2020) suggested that managers can provide ex post explanations of past events, thus communicating a sophisticated and contextualised reality to the user. The existing literature posits that retrospective sense-making aims to offer discretionary, non-self-serving, ex post explanations of organisational events and outcomes to maintain or restore a firm’s image (Aerts, 2005; Merkl-Davies et al., 2011; Stanton & Stanton, 2002). The anticipation of how information recipients will respond to managerial disclosures may motivate managers to engage in retrospective sense-making (Aerts, 2005). Several scholars have found that the application of IM tactics may be driven by managers’ opportunistic behaviour, aiming to intentionally disguise the firm’s image, or by informational processes through which managers engage in retrospective sense-making, framing organisational outcomes in a favourable light (Aerts, 2001, 2005; Merkl-Davies et al., 2011).

4.7. Obscure Language

It has been found that the use of obscure language is one of the IM strategies employed during the development of the CS (H. Wang et al., 2012; Smith et al., 2006; Man et al., 2019). H. Wang et al. (2012) suggested that fuzzy language is notably more prevalent in the CS. These authors further explained that fuzzy words are those that make matters less precise or more ambiguous, such as “about”, “sort of”, “some”, “less”, “more”, “approximately”, and “believe”. Channel (2000) argued that the use of imprecise words allows for flexibility in conveying information and serves as a self-protection strategy. On the other hand, Channel (2000) also postulated that vague language is often employed when explicit information is absent or intentionally withheld.

4.8. Language Tone

Several studies have shown that managers use IM by manipulating the tone of their disclosures, including the CS, to shape investors’ perceptions of corporate performance (Phesa et al., 2021; Vogel, 2018; Melloni et al., 2016; Totowa & Mokoaleli-Mokoteli, 2021; Schleicher & Walker, 2010; Clatworthy & Jones, 2003; Phesa et al., 2023). Guillamon-Saorin et al. (2017) explained that tone involves the use of positive language, statements, keywords, or numerical figures to create a favourable impression of firm results, which would be difficult to achieve with more neutral language. Nel et al. (2022) found that CSs were more optimistic than CEO statements, concluding that IM was evident in both types of disclosures. Melloni et al. (2016) noted that integrated reports generally conveyed a positive tone, with this optimism linked to a set of characteristics suggestive of disclosure manipulation. Supporting this, other studies (e.g., Clatworthy & Jones, 2003) found that firms tend to highlight the positive aspects of their performance and take credit for good news while blaming external factors for negative outcomes. Fisher et al. (2019) concluded that there is a prevailing trend of positivity, optimism, and pragmatism in the CS.

4.9. Self-Serving Attribution

Self-serving attribution is one of the IM strategies identified in CSs (Bhana, 2009; Clatworthy & Jones, 2003; Vivian & Mei, 2022; Al Lawati et al., 2023; Yee & Cheong, 2022; Huang & Wang, 2020; Shaikh et al., 2024). Bhana (2009) suggested that managers use accounting narratives, such as the CS, in a self-serving manner rather than reporting performance objectively. Both Bhana (2009) and Clatworthy and Jones (2003) found that both profitable and unprofitable companies engage in self-serving attribution, a tendency to attribute positive performance to internal factors while blaming external factors for negative performance. Similarly, Salancik and Meindl (1984) argued that the positive link between self-serving attributions and future performance reflects effective IM.

4.10. Photographs

CSs do not rely solely on text; they are often created through the combined use of textual content and photographs. The inclusion of photographs has become a standard practice and a defining feature of corporate reporting, as they enhance corporate disclosures. As an IM strategy, photographs can be strategically used to influence investors’ perceptions (Merkl-Davies & Brennan, 2007; de Groot et al., 2006). Merkl-Davies and Brennan (2007) argued that firms can leverage visual effects and pictorial elements to exaggerate favourable results, often by highlighting specific performance disclosures. The existing literature indicates that companies are increasingly engaging in visual manipulation. Photographs, being visually appealing, tend to attract more attention than text. Furthermore, they carry emotional weight, often featuring themes such as depictions of people and technology.

4.11. Impersonalisation and Evaluation

Managers can employ grammatical devices, such as impersonalisation and evaluation, to manipulate users of the CS (Merkl-Davies & Koller, 2012). These devices are intentionally used to guide the audience’s interpretation of organisational actions and results (Merkl-Davies & Koller, 2012). Merkl-Davies and Koller (2012) further explained that impersonalisation obscures social agency, thus presenting processes in a more abstract and factual manner. Impersonalisation involves using linguistic methods to eliminate or obscure social agents in the depiction of processes. Fairclough (2003) noted that impersonalisation makes social agents disappear, freeing management from accountability or responsibility for organisational actions and results, thereby promoting acquiescence. According to Merkl-Davies and Koller (2012), in English, four common linguistic methods of impersonalisation include (i) referential vagueness, (ii) passivisation, (iii) grammatical metaphor (nominalisation), and (iv) conceptual metaphor and metonymy. Referential vagueness involves a shifting referential range in the use of the first-person plural (i.e., I, we, our, us), where it is unclear who “we” represents (Merkl-Davies & Koller, 2012; Ahmed & Salat, 2019), thereby attributing actions to a vaguely defined collective social actor (Merkl-Davies & Koller, 2012). Passivisation involves using a passive construction to obscure or downplay the social agent involved in an action (Merkl-Davies & Koller, 2012; D’Northwood, 2015). Grammatical metaphor (nominalisation) entails converting processes and properties into nouns (Halliday, 1994), turning actions and attributes into states (Merkl-Davies & Koller, 2012). Conceptual metaphor involves cross-domain mapping, where one (often abstract) concept is understood in terms of another (more concrete) one (Merkl-Davies & Koller, 2012). Both conceptual metaphor and metonymy are used for lexical underspecification, referring to social actors at varying levels of abstraction and generality (Merkl-Davies & Koller, 2012). Evaluation, on the other hand, involves making value statements about the significance, desirability, or usefulness of social actors, concepts, or events (Fairclough, 2003; Cleary et al., 2019). Fairclough (2003) also suggested that authors implicitly or explicitly commit to particular values by making evaluative statements. These statements can be positive or negative, implicit or explicit, and help define what is considered desirable or undesirable (Merkl-Davies & Koller, 2012).

4.12. Forward-Looking Statements

Firms can engage in impression management (IM) by incorporating forward-looking statements that hint at potential future strategic actions (Athanasakou & Hussainey, 2014; Schleicher & Walker, 2010). In support of this, Chen et al. (2024) argued that managers are often expected to strategically manipulate non-earnings-related qualitative forward-looking statements to shape investors’ perceptions of a company’s future fundamentals, thereby achieving self-serving objectives. This is not surprising, as forward-looking statements are commonly used in corporate reporting. Typically, such information provides valuable insights into company strategy and future projections (Abhayawansa, 2011), which makes it susceptible to IM. Athanasakou and Hussainey (2014) suggested that management tends to use forward-looking statements primarily when a company is preparing to take on significant debt or is facing negative financial results. For additional information on forward-looking disclosures and IM, see Al Lawati et al. (2023) and Busenbark et al. (2017).

4.13. Graphs

Graph usage has become ubiquitous (Beattie et al., 2008), and firms often use graphs as an IM strategy in the CS to present a more favourable view of their image and performance. Beattie et al. (2008) argued that IM through graphical measurement distortion, selectivity, and manipulation of time series graphs is widespread, noting that annual reports often resemble public relations documents rather than strictly financial or statutory reports. Varachia and Yasseen (2020) observed that South African listed firms do not significantly enhance the visual aspects of their graphs; however, their analysis revealed notable measurement distortions. These firms tend to exaggerate underlying trends in their graphs rather than downplay them (Varachia & Yasseen, 2020). Talha and Salim (2011) found no substantial differences between profitable and unprofitable firms, except that profitable firms tend to include more graphs and images in the CS, particularly when presenting bottom-line performance. Drawing from contemporary theories of graphical perception, Beattie and Jones (1992) highlighted selectivity in graph usage and a failure to follow proper graph construction principles as key sources of distortion. They found that firms with strong performance were significantly more likely to include financial graphs. For further reading on the use of graphs in IM, see Rahman et al. (2014), Cho et al. (2012), and Arunachalam et al. (2002).

5. Integrative Conceptual Framework

Based on the identified IM strategies employed in the CS, we propose an integrative conceptual framework that incorporates these strategies, refer to Figure 4 below. These strategies include readability, textual characteristics, culture, legal systems, and capital markets; paratext; intertextuality; language tone; forward-looking statements; retrospective sense-making; obscure language; graphs; photographs; impersonalisation and evaluation; and self-serving attribution. This framework connects IM, IM tactics, and the CS, illustrating how these tactics directly influence the CS.

6. Research Gaps

This section outlines research gaps identified from the reviewed studies and the supporting literature on IM and corporate discretionary disclosures, specifically CSs. These gaps offer opportunities for future exploration in this critical and under-researched field. Since IM can compromise financial reporting quality and lead to capital misallocations, it remains a vital topic with significant research potential. Current studies indicate that IM in CS research is still in its early stages.

6.1. Audit/Verifiability of CS

CSs are unaudited and unregulated, yet studies call for oversight. Can auditors and regulators effectively assess IM in narratives? Research must explore their feasibility and capability in evaluating qualitative disclosures.

6.2. Standardisation of Voluntary Narrative Disclosures

Scholars advocate accounting standards for auditing CS (Merkl-Davies et al., 2011; Phesa et al., 2021; Yasseen et al., 2017). Research should assess auditor, regulator, and shareholder views on feasibility and standardised formats (Cooper & Slack, 2015).

6.3. Perceptions of CS Users

Research mainly examines CS preparers, but user perspectives like investor reactions to IM, content interpretation, and drivers of engagement need study to assess the CS’s impact on decision-making.

6.4. Culture as Determinant of the Use of IM

Research on IM in CSs shows mixed results, with some statements manipulating perceptions. Studies suggest IM strategies are influenced by regulations, markets, and culture (Mir et al., 2009), highlighting the need for cross-jurisdictional comparisons.

6.5. Use of Artificial Intelligence to Detect IM

Current IM detection methods rely on manual/statistical analysis, lacking precision. AI can improve scalability, reduce bias, and enable cross-jurisdictional analysis of subtle IM strategies in large datasets.

6.6. IM Use During Crises

Research on IM in CSs during crises (e.g., COVID-19, 2008 financial crisis) remains scarce despite the CS’s critical role in turbulent times. Comparative studies of crisis vs. normal-period IM strategies could enhance understanding of corporate communication dynamics.

6.7. Longitudinal Research Design

Limited research analyses IM in CSs longitudinally (Cleary et al., 2019; Moreno et al., 2019). Tracking IM strategies across economic cycles could reveal evolutionary patterns and strengthen causal understanding.

6.8. The Actual Preparers of CSs

Research suggests PR teams often draft CSs more than chairpersons (Beattie, 2014; Leventis & Weetman, 2004). Studies should examine the following: chairperson involvement, required skills, PR’s role, and how chairperson attributes (experience, qualifications, gender) influence CS content.

6.9. Studies Based on Primary Data

Current research relies heavily on secondary data. Future studies should collect primary data from preparers and chairpersons to verify IM awareness/responsibility and validate existing findings.

7. Conclusions

The introduction of the CS marks an evolution in corporate reporting, providing an authoritative, high-level summary of a company’s actions, initiatives, operations, finances, and achievements from the previous financial year, along with a forward-looking perspective. Due to its comprehensive and informative content, the CS is considered the most read segment of the integrated report, consistently ranked as the top narrative disclosure by users. However, it is also a prominent section where management often employs IM to convey a biased, overly positive image of the company. In this study, we examined the IM tactics used in the CS through a systematic literature review (SLR). Based on the identified IM strategies in the CS, we developed an integrative conceptual framework that incorporates these tactics. The IM strategies include readability, textual characteristics, culture, legal systems, and capital markets; paratext; intertextuality; language tone; forward-looking statements; retrospective sense-making; obscure language; photographs; graphs; impersonalisation and evaluation; and self-serving attribution.

The findings of this study underscore the rich and relevant nature of researching IM tactics in the CS, an area that warrants deeper exploration due to its complexity and qualitative nature. This study contributes to the ongoing debate on the use of IM in corporate reporting, particularly in the CS, and introduces the IM Integrative Conceptual Model, which outlines the key IM tactics. We also caution users of integrated reports about the potential overuse of IM, especially in voluntary narrative disclosures. Despite these exciting findings, this study has some limitations. Firstly, the issue of CEO duality, where the chairperson is also the CEO, was not considered, meaning that statements attributable to both roles were not fully accounted for in the results. Future research could explore all CSs, including those affected by CEO duality. Additionally, the SLR may have overlooked some relevant articles due to factors such as database selection, time limitations, exclusion of grey literature, and a focus only on English-language publications. To extend this research, future studies could consider reviewing a broader range of articles from additional databases, incorporating grey literature, and including publications in languages other than English. Finally, further SLRs could examine the IM tactics used in other discretionary accounting narrative disclosures, such as the CEO statement, to identify similarities and differences in the IM strategies employed.