We provide theory and experimental evidence consistent with an unintended, causal relation between Corporate Social Responsibility (CSR) performance and investors' estimates of fundamental value that can be attenuated by investors' explicit assessment of CSR performance. Consistent with “affect-as-information” theory from psychology, we find that investors who are exposed to, but do not explicitly assess, CSR performance derive higher fundamental value estimates in response to positive CSR performance, and lower fundamental value estimates in response to negative CSR performance. Explicit assessment of CSR performance, however, significantly diminishes this effect, indicating that the effect among investors who do not explicitly assess CSR performance is unintended; i.e., they unintentionally use their affective reactions to CSR performance in estimating fundamental value. Supplemental findings shed light on consequences of these fundamental value estimates: investors who do not explicitly assess CSR performance rely on their unintentionally influenced estimates of fundamental value to increase the price they are willing to pay to invest in the stock of a firm with positive CSR performance. Overall, our theory and findings contribute to the CSR and affect literatures in accounting by revealing the contingent nature of how and to what extent CSR performance influences investors' beliefs about firm value and the bids these investors are likely to make in equity markets. Data Availability: Contact the authors.

The evolution of C4 grassland ecosystems in eastern Africa has been intensely studied because of the potential influence of vegetation on mammalian evolution, including that of our own lineage, hominins. Although a handful of sparse vegetation records exists from middle and early Miocene terrestrial fossil sites, there is no comprehensive record of vegetation through the Neogene. Here we present a vegetation record spanning the Neogene and Quaternary Periods that documents the appearance and subsequent expansion of C4 grasslands in eastern Africa. Carbon isotope ratios from terrestrial plant wax biomarkers deposited in marine sediments indicate constant C3 vegetation from ∼24 Ma to 10 Ma, when C4 grasses first appeared. From this time forward, C4 vegetation increases monotonically to present, with a coherent signal between marine core sites located in the Somali Basin and the Red Sea. The response of mammalian herbivores to the appearance of C4 grasses at 10 Ma is immediate, as evidenced from existing records of mammalian diets from isotopic analyses of tooth enamel. The expansion of C4 vegetation in eastern Africa is broadly mirrored by increasing proportions of C4-based foods in hominin diets, beginning at 3.8 Ma in Australopithecus and, slightly later, Kenyanthropus. This continues into the late Pleistocene in Paranthropus, whereas Homo maintains a flexible diet. The biomarker vegetation record suggests the increase in open, C4 grassland ecosystems over the last 10 Ma may have operated as a selection pressure for traits and behaviors in Homo such as bipedalism, flexible diets, and complex social structure.

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This study examines the effect on investors' judgments of corporate social responsibility (CSR) measures when integrated with financial information in a single report versus when presented in a separate CSR report. Advocates for integrated reports argue that CSR information will be perceived as more relevant and have a greater impact on users when observed in an integrated report. However, we provide experimental evidence that CSR measures have greater influence on investors' judgments when investors observe the CSR information and financial information depicted in separate reports. We also provide evidence that this greater influence of CSR measures is caused by investors' evaluations taking on a “multidimensional perspective” that includes both a social responsibility and a financial dimension, which is triggered by observing the separate CSR report. Activating a social responsibility dimension elevates the perceived relevance of CSR measures, increasing their influence on investors' judgments. Our study contributes to practice by highlighting a potential unintended consequence of issuing integrated versus separate CSR reports: that investors incorporate CSR information less when it is integrated with financial information versus separately reported.

This study examines disaggregated management forecasts as a mechanism to reduce investors’ fixation on announced earnings. Our experimental results suggest that investors’ earnings fixation is reduced when they initially observe a disaggregated management forecast (earnings and its components) versus when they observe an aggregated forecast (earnings only). We also provide theory-consistent evidence that this reduction in earnings fixation is associated with investors interpreting the summary net income figure as one of several similarly important evaluation inputs rather than a substantially more important input (relative to its components). Finally, we provide evidence that suggests our results are not bounded by the level of emphasis on net income in the subsequent earnings announcement, and not fully explained by three plausible alternative explanations. Our study extends the voluntary disclosure literature by providing evidence that the form of management disclosures can influence investors’ interpretation of subsequently announced information, and contributes to practice by providing a potential alternative to stopping earnings guidance.