Impression Management and Financial Reporting on Social Media: Insights from LinkedIn Profiles of JSE Top 40 Listed Companies

Abstract

Abstract: This study examined the use of LinkedIn as a social media platform for impression management. As LinkedIn is increasingly adopted as a formal communication channel by companies, it has also become a platform for disseminating accounting results. This raises concerns about whether LinkedIn is being used effectively as a communication tool or LinkedIn is being used as a part of broader impression management strategies. The study focused on the top 40 companies listed on the JSE main board, representing 80% of the listed companies. These companies were categorised into profit-increasing and profit-decreasing groups. Content analysis was conducted to assess the presence of impression management, with a focus on tone, presentational patterns, volume of disclosure, and stakeholder engagement. The results of this study revealed that profit-decreasing companies tend to adopt a more positive tone than profit-increasing companies to maintain stakeholder confidence, the use of presentational patterns was found to be unrelated to a company’s performance as no significant differences were observed between profit-increasing and profit-decreasing companies in this regard. In addition, the volume of accounting disclosures was higher for companies performing well, possibly as a strategy to emphasise positive results. Lastly, stakeholder engagement was greater when companies presented strong performance, suggesting that good performance drives higher stakeholder engagement. Based on the study’s findings, stakeholders are encouraged to be cautious about the accounting results shared on LinkedIn by JSE-listed companies, as these companies often adopt a positive tone to achieve specific positive effects. Stakeholders should always corroborate LinkedIn posts with audited financial statements before making decisions about the company.