Assessing Impression Management Using a Narrative Reporting Index: Evidence from the Top 40 JSE-Listed Companies

This study responds to the call to apply the Impression Management Narrative Reporting (IMNR) index to a larger sample, extending its application to the top 40 JSE-listed companies in South Africa. While the prior literature has established the presence of impression management (IM) in narrative reports of JSE-listed companies, no study has quantitatively measured its level using multiple IM tactics combined into a single metric. Using content analysis, secondary data were collected from CEO letters to shareholders in annual or integrated reports. A purposive sample of 26 of the top 40 listed companies was analysed following the IMNR index methodology. The findings reveal a median IMNR score of 5.20 (out of 8), classified as a high level of narrative interference. Tone manipulation emerged as the dominant tactic (median 0.90), followed by rhetoric (0.83) and readability (0.81), while comparison was the least used tactic (0.38). These results may confirm, to some extent, the elements of IM in CEO letters of JSE-listed companies. The study demonstrates the practical relevance of the IMNR index in emerging market contexts. The evidence of some elements of IM in CEO letters mean that investors should exercise caution when engaging with the CEO letters. Since the CEO letters are narrative disclosures, they are currently not verified. Standard setters may consider exploring the possible guidelines to ensure verification of narrative disclosures.