CEO Narcissism and Repetitive Language in MD&A Disclosures: Informative Reinforcement or Opportunistic Obfuscation?

Abstract

This study examines how CEO narcissism shapes repetitive language in corporate disclosures, focusing on the repetition of content from financial statement notes into the MD&A sections of U.S. 10-K filings. Drawing on the agency and impression management theories, we investigate whether narcissistic CEOs use repetition to reinforce credible information or to obscure stakeholder understanding. Using 20,511 firm-year observations from 2002 to 2020, we document a robust positive association between CEO narcissism and textual repetition. This repetition is associated with lower earnings management, stronger subsequent firm performance, and reduced analyst forecast dispersion, while repeated content is, on average, more positive and more forward-looking. These patterns suggest that repetition functions as informative reinforcement that also serves CEOs’ self-enhancement purposes. The association is stronger when CEOs possess greater capacity to shape narratives and when incentives and credibility conditions are more favorable, and it is observed in both financial and non-financial content. The results are robust to endogeneity concerns. Overall, repetition associated with CEO narcissism can simultaneously serve self-presentation motives and enhance the firm’s information environment.