The LAAPs that foster productive conversations and the crebit that undermines them

Accounting, Organizations and Society xxx (2018) 1e8

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Commentary

The LAAPs that foster productive conversations and the crebit that undermines them Robert Bloomfield S.C. Johnson Graduate School of Management, Cornell S.C. Johnson College of Business, Cornell University, USA

a r t i c l e i n f o

a b s t r a c t

Article history: Received 2 April 2018 Accepted 21 June 2018 Available online xxx

People who use venues for productive conversations impose norms (“LAAPs”) encouraging statements that are meaningful, relevant, honest, understandable, diplomatic, engaging, helpful, and supportive of the long-term success of the venue. Statements that undermine productivity by falling short on some of these characteristics without sufficient strength on others are excluded, policed and punished as “crebit”. I describe a variety of LAAPs and their crebit, use the framework to offer testable predictions about when speech will be punished as crebit, and propose some exclusions that would allow more productive conversations online and about the limits of speech on campus. © 2018 Published by Elsevier Ltd.

Keywords: Conversational norms Accounting standards Conceptual framework Financial reporting Freedom of speech

1. Introduction and definitions When people want to talk about something important, they find a venue with norms that help them talk productively. These norms are so similar to norms underlying Generally Accepted Accounting Principles (GAAP) that I call them LAAPs (with the L for Locally). Whether the venue is a balance sheet, conference call, courtroom, Twitter feed, dinner party, or academic conference, its LAAP demands that what we say is meaningful, relevant, honest, understandable, diplomatic, engaging, helpful, and supportive of the long-term success of the venue. Whether LAAPs are articulated in detail (as with GAAP) or are more obscure (as in academic conferences), they are usually quite complex. I simplify my analysis by focusing on the first decision one must make when applying GAAP to financial statements: determining whether to make any entry at all to account for some matter (recognition). If the matter is to be recognized, one must then determine which accounts to use (classification), how much to adjust the accounts (measurement), and how to aggregate, and format them (presentation). But if the matter is not to be recognized at all, these later decisions become moot, simplifying matters tremendously. Focusing on recognitiondand in particular on what can not be recognizeddalso highlights the stakes of analysis, because restrictions on speech are highly contentious. Finally, focusing on what cannot be recognized makes it easier to see how

E-mail address: bloomfi[email protected].

venues complement and compete with one another, since what cannot be recognized in one venue may be recognizable in another. Following my accounting metaphor, I call the statements one should not say under a LAAP crebit. The term is a confusion of credit and debit that captures the most fundamental restriction on what can be said in financial statements: a matter can’t be recognized unless it can be represented as a balancing set of debits and credits. Crebits can’t be recognized because they are unintelligible in the framework of double-entry bookkeeping that the financial community has agreed to use in the venue of financial statements. I generalize crebit to refer to any matter that is excluded because it violates the norms that allow conversations in a venue to be productive, for any of the reasons listed in the first paragraph above. What LAAPs treat as crebit reveals a great deal about the venue the LAAPs govern. What are the goals of the conversation? Are they narrow and shared by all, or broad and diverse? Are there sharp conflicts of interests between speakers and the audience? How costly is it to process and respond to statements? What is likely to cause harm or offense? Whose support is needed for the LAAP to continue as a productive venue? Are there other venues where a statement can be expressed? Will people be able to draw from those venues before acting on what they hear in this one? All of these factors change the minimum thresholds for conversational norms, the diligence with which crebit is policed, and the severity of the punishment imposed on those who undermine the productivity of a conversation by introducing crebit into an argument, an act I call crebitry. I use crebit as a lens to interpret the results of Grant, Hodge, &

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Sinha (2018, this issue, hereafter GHS), and propose some extensions. GHS provide experimental evidence that participants see a CEO as less credible, and are less inclined to invest in their firm, if the CEO uses Twitter to “brag” about good performance by taking credit for it using intensifying language. They react far less negatively when the CEO brags on a conference call. I argue that these results reflect differences in minimum thresholds for diplomacy across the two venues. Statements about performance must be diplomatic because bragging threatens’ the social status of audience members who don’t already identify closely with the speaker, triggering emotional responses that can derail the conversation. Diplomacy is more important on Twitter than in conference calls, because Twitter audiences are likely to care more about status and identify less with the CEO. The same brag can thus fall below the diplomacy threshold for Twitter, and be treated (and punished) as crebitry, while still being above the diplomacy threshold for a conference call. A similar argument explains why GHS find that investors response harshly to “humblebragging” in both settings. Statements are humblebrags when they pair a claim of credit with a claim that evokes sympathy (Sezer, Gino, & Norton, 2018). Humblebrags undermine productive conversation unless participants identify so closely with the speaker that they are able to be both impressed and sympathetic at the same time. Humblebragging is therefore likely to be punished as crebitry in any venue other than a gathering of family and close friends. Finally, I discuss how wiser LAAPs and more effective policing of their crebit would allow more productive conversations that take place on the internet, or that seek to define appropriate limits to free speech on campus. Many online venues are devoid of any LAAP whatsoever, making productive conversations exceptionally difficult. Conversations about campus speech are often undermined by careless references to First Amendment rights, absolutist arguments that place no value on certain characteristics of speech (especially diplomacy, efficiency and support for the venue), and disruption of venues that comply with campus LAAPs as they are, but not as protesters think they should be. The remainder of this paper is organized as follows. In section 2, I provide examples that illustrate my framework for describing LAAPs and their crebit. In section 3, I apply the framework to interpret reactions to bragging, modesty, and humblebragging in GSH. In section 4, I offer some insights on the current state of discourse online and about college campuses. I conclude in section 5 by discussing some implications of this analysis for the future of accounting scholarship. 2. Framework and examples As defined in section 1, a LAAP is a set of norms that makes a conversation more productive, partly by excluding some contributions as crebit because they undermine that productivity, and provides a basis for punishing those who commit crebitry by discussing crebit where they shouldn’t. Table 1 presents the three groups that can impose LAAPs and why that matters. LAAPs can be imposed by regulators,

organizations or communities. LAAPs imposed by regulators, such as those governing financial statements and courtrooms, can punish crebitry through fines and imprisonment, so they tend to be articulated in great detail. LAAPs imposed by organizations, such as news outlets, can punish crebitry by withholding professional and financial rewards, so they are articulated in enough detail to justify such decisions. LAAPs imposed by communities, such as those governing dinner parties and academic seminars, are often not articulated at all because no one is fully aware of what they are. Communities therefore limit their punishments to shaming and shunning. Table 2 presents the eight characteristics that I argue determine whether a contribution to a conversation is crebit. A statement undermines productivity more if it falls shorter on Intelligibility, Faithfulness, Relevance, Helpfulness, Support, Efficiency, Diplomacy, and Engagement. It is treated as crebit if it falls short enough on one or more characteristics, without sufficient compensating virtues on the other characteristics. As recommended by Joyce, Libby & Sunder (1982), I have tried to make this list of characteristics operational, comprehensive and parsimonious. The list is operational if different people tend to draw similar conclusions about whether a statement falls below a threshold on the same characteristic, but draw different conclusions about whether if falls below thresholds for different characteristics. It is comprehensive if it captures all of the characteristics that might cause a statement to be treated as crebit, and parsimonious if the characteristics are independent, so that falling below a threshold on one characteristic provides little information about whether it will fall below a threshold on another. Table 3 summarizes some key environmental factors that determine what characteristics most foster productivity in a particular conversation. I make no claim that this list is comprehensive; they are simply factors that seem important in the LAAPs I use to illustrate my framework, and seem amenable to empirical testing. I now provide a rather extended description of GAAP to illustrate as much of the framework as possible in a financial reporting context (with the first application of each characteristic in bold). Descriptions of the other LAAPs are progressively briefer, as they are intended mostly to highlight aspects of the framework not illustrated well by preceding examples. 2.1. Financial statements GAAP is a LAAP governing how large, publicly traded corporations converse with U.S. investors through multiple venues, including financial statements, supporting footnotes, and supplementary disclosures. These conversations are so economically important that GAAP is imposed by the Financial Accounting Standards Board (FASB), through powers delegated by Congress and the Securities and Exchange Commission (SEC). Because GAAP is imposed by regulators, those who violate it may face legal sanctions. The threat of such severe punishment is one reason GAAP has been articulated in such detail.

Table 1 Who imposes a LAAP. Party Regulator

Description

LAAP is imposed by a party to which organizations are answerable. These LAAPs tend to be highly explicit to allow legal sanction for violations. Organization LAAP is imposed by an organization to which individuals are answerable. These LAAPs tend to be moderately explicit to allow organizational sanction for violations. Community LAAP is imposed by a group of individuals. These LAAPs are often unarticulated, allowing only informal social sanction for violations.

Examples GAAP, U.S. Federal Rules of Evidence New??? outlets, addiction intervention facilitators, Scholarly communities, business meetings, dinner parties, Facebook groups

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Table 2 Characteristics of statements and examples of crebit. Characteristics Description

Examples of crebit

Intelligibility

Accounting entries that don’t balance debits and credits; claims drawn from other scholarly disciplines Statements based on only one anonymous source in journalism Accounting entries that don’t reflect an entities resources or claims to those resources; Statements revealing identity of minors in news outlets; Statements that anger valuable sources in journalism, or venue sponsors in academia Meandering comments at conferences; needless cumulative evidence in courtrooms Explanations of the causes of addiction in an intervention; criticisms of appearance in business settings Overly technical matters in news outlets aimed at popular audiences; monotonously delivered comments at conferences.

Faithfulness Relevance Helpfulness Support Efficiency Diplomacy Engagement

Statements have a meaning that can be understood by the venue’s audience Statements accurately represent what they purport to represent. Statements have the potential to change decisions or beliefs of interest to the venue audience audiences Statements help (or at least do not hurt) valued people and organizations Statements enhance (or at least do not reduce) support for the venue Statements demand as little time and attention as needed to communicate their point Statements avoid triggering strong emotional responses that make further conversation less productive Statements that strengthen an audience’s emotional, cognitive and behavioral connection to the conversation.

Table 3 Environmental factors shaping thresholds for crebit. Factor

Definition

Examples

Framework-dependence

The extent to which audience members rely on a clearly articulated framework of terms and relationships

Goals

The decisions and beliefs the target audience cares about, which may be focused or diverse.

Conflicts of Interests

The differing costs and benefits participants experience based on the content of a statement.

Competition

The availability of other LAAPs that provide complementary or substitutable reports

Sensitivities

The types of statements that are likely to trigger emotional responses The costs of gathering, interpreting and acting upon reports generated by the LAAP

Financial statements are highly dependent on the framework of doubleentry bookkeeping; scholarly disciplines are highly dependent on the frameworks used in their paradigm Investment and compensation decisions in accounting (diverse); legal verdicts in trials; treatment decisions in addiction interventions (focused) Interests of managers and investors in GAAP and of plaintiffs and respondents in courtrooms (high conflict); interests of family members and addicts in interventions (low conflict) GAAP and investigative reporting complement one another by treating different matters as crebit by pursing different forms of relevance and faithfulness. News outlets are often substitutes. Statements that threaten people’s self-image of honesty, competence, or status. Costs are low for financial reports, relative to the value of information; costs are high for courtrooms, because jurors are a captive audience and each hour of a trial is expensive Financial statements are used with low immediacy for investment decisions because investors can consult analyst reports and news outlets; they are used with high immediacy for contractual payments based on net income

Processing Costs

Immediacy

The inability of audiences to consult other venues before making a decision

To simplify my analysis, I restrict my attention to the GAAP governing what entries firms are permitted to make in their accounts (ignoring the larger GAAP governing footnotes and supplementary disclosures). GAAP treats an entry as crebit if it doesn’t include balancing debits and credits, because such entries fail a test of intelligibility in a venue that relies so heavily on the framework of double-entry bookkeeping. An entry without balancing debits and credits undermines discourse because it is “not even wrong” (a phrase often attributed to physicist Wolfgang Pauli). GAAP imposes a high threshold for faithfulness because reporters and their audiences have such sharp conflicts of interest. GAAP thus doesn’t permit statements that can’t be trusted to faithfully reflect what the speaker actually knows. In contrast, GAAP has lax thresholds for relevance, treating entries as crebit only if they fall outside the purpose of double-entry bookkeeping, which is to allow productive conversation about an accounting entity’s resources, the claims on those resources, and how those resources and claims change over time. Some characteristics have no impact on what entries GAAP treats as crebit, even though they are very important in shaping what entries GAAP requires them to make. For example, GAAP doesn’t require reporting some intelligible, relevant, and faithful entries because doing so would harm the reporting firm (a failure of helpfulness, like demanding a firm reveal trade secrets) or because

they would make it harder to sustain the venue (a failure of support, as seen in the controversies over accounting for stock options and the fair value of bank loans). Other entries are not required because they would demand too much time to interpret (a failure of efficiency, as arises in many highly technical matters like making separate entries for options embedded in complex contracts) or might address emotionally or politically sensitive issues that would divert attention from productive discussion of resources and claims (a failure of diplomacy, as might occur if GAAP required reporting on the impacts of climate change). I am not aware of any cases in which GAAP prohibits entries for these reasons. I am also unaware of any entries that are either required or prohibited because they fail a threshold of engagement, which I define similarly to Attfield, Lalmas, Kazai & Piwowarski (2011, p. 1) as a statement that encourages “the emotional, cognitive and behavioural connection … between a user and a resource.” Those who set accounting standards appear to assume that investors and other target audiences will have a high tolerance for boring entries, as long as they provide intelligible, faithful and relevant input into important financial matters. Financial statements are often used as a venue for conversations within the firm. In these cases, organizations can devise their own LAAP to determine which entries would be excluded as crebit. How they choose thresholds for relevance and faithfulness are shaped in

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complicated ways by the immediacy with which financial statements are used. They are used with high immediacy when pay is contractually determined by reported income or some other measure reported in the statements, without decisions being intermediated by consultation with other reports (as typically happens when pay is based on subjective evaluations). Immediacy encourages firms to lower thresholds for relevance, because contracts are more useful when they more completely reflect all relevant matters. It also encourages firms to raise thresholds for faithfulness, because contracting tends to be more successful when parties with conflicting interests have limited opportunities to distort relevant measures. 2.2. U.S. Federal Rules of Evidence The U.S. Federal Rules of Evidence are the LAAP governing what can be said under oath in a courtroom. As with financial statements, the stakes of productive conversations about courtroom testimony are high enough that rules of evidence are imposed by regulators with the power to punish crebitry severely, leading to elaborate articulation of what is treated as crebit. Also like financial statements, conflicts of interest are stark enough that testimony must meet a high threshold of faithfulness to be admitted into the courtroom. Unlike financial statements, testimony is presented to a captive audience (jurors and judges) who must use that testimony for decisions, and must do so without consulting other venues. As a result, testimony must meet a high threshold of relevance and efficiency to not be excluded as crebit by Rule 403 for causing “undue delay, wasting time, or needlessly presenting cumulative evidence.”1 Federal Rules of Evidence provide a useful example for distinguishing two characteristics of speech that are often conflated, offensiveness (a lack of diplomacy) and harm (a lack of helpfulness). The Rules of Evidence treat offensive statements as crebit not because they harm the people who are offended, but because they trigger emotions (“undue prejudice” in Rule 403) that make it hard for those who are offended to contribute productively to the conversation. Rules of Evidence also treat some statements as crebit because they are harmful to minors, law enforcement, or other groups the Federal government seeks to protect. While a single statement may be both offensive and harmful, diplomacy and helpfulness undermine productive conversation in different ways, so their thresholds for crebit vary with environmental factors in different ways. 2.3. News outlets News organizations impose their own LAAPs governing what their outlets can report. Relevance for news organizations is quite different than for financial statements and courtrooms, because conversational goals are not necessarily focused on decisionmaking. Many people use news venues for education or entertainment. These uses lower the stakes of the conversation for audience members, causing journalistic LAAPs to exclude many relevant and faithful stories because readers find them unengaging. News organizations that care about their reputation impose high standards for faithfulness. Reuters provides a detailed list of policies (Reuters, 2018) many of which force reporters to treat otherwise valuable information as crebit. Reuters journalists are not allowed to report information that is based on a single anonymous source (for faithfulness), or that was elicited through misrepresentation of the journalist’s identity (for self-

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See https://www.law.cornell.edu/rules/fre/rule_403.

preservation). “Vituperative” comments can only be included if the source is willing to have quotations attributed to them within the article, because these are more likely to reflect a conflict of interest. Most news outlets expect reporters to follow the guidelines of The Society of Professional Journalists (SPJ, 2018), which emphasizes the need to “[b]alance the public’s need for information against potential harm or discomfort”, by avoiding “undue intrusiveness” and “compassion for those who may be affected”, particularly “juveniles, victims of sex crimes, and sources or subjects who are inexperienced or unable to give consent.” This effectively treats many matters as crebit even if they are relevant, faithful, and interesting. Because they set their own LAAPs, news organizations have tremendous control over what they exclude as crebit. However, they must always do so in light of their competitive situation. Unlike financial statements and courtrooms, news organizations face direct competition from other venues that differ primarily in the LAAPs that govern them, making the choice of crebit an essential part of business strategy. Buzzfeed and Gawker grew rapidly by relaxing sourcing standards, sacrificing faithfulness in order to provide news established outlets treated as crebit. Others have grown by setting standards that appeal to people who want news that supports their existing views. This can be accomplished directly by defining relevance or offensiveness in a biased fashion (e.g., only stories about good cats and bad dogs are relevant, stories about bad cats and good dogs are offensive). It can also be accomplished indirectly by biasing standards for faithfulness (only report on a bad cat if we have three independent sources, but one is enough to report on a good cat). 2.4. Addiction interventions Addiction interventions became popular with the publication of “I’ll Quit Tomorrow” (Johnson, 1973). Under the updated “Johnson model” of interventions (AIS, 2018), family and friends gather with an extremely focused goal: to persuade the target of the intervention to seek immediate treatment, which ideally has been prearranged. The Johnson model treats so many matters as crebit that it is one of the few LAAPs where it is easier to describe what one should say than what one should not. One can express love and concern for the target, offer documentation of the harm the addiction is causing them (but only if it is unimpeachably faithful), and argue that immediate treatment will help (even if such arguments are not so faithful). No other statements are permitted. Speakers are not to discuss possible causes of the target’s addiction (“it’s that girlfriend of yours”), label the target with derogatory terms (including “addict”), or demand that they take responsibility for past actions. None of these statements are relevant to the narrow and highly immediate question at hand (“will you check in to Healthy Haven Treatment Center tonight?”), and most of them are likely to derail the conversation by triggering defensive emotions. 2.5. Scholarly communities Scholarly fields are notorious for posing narrow questions and answering them with narrow methods. This narrowness stems from the tendency of scholars to adopt what Kuhn (2012) called a paradigm, which forms the foundation of a scholarly community’s LAAP. Reworded in my framework, paradigms spell out a framework for intelligibility, and standards for what questions are relevant and what answers are faithful. These standards are imposed not by a regulator or organization, but by a community of scholars. They are rarely articulated, because no one person is in a position to articulate them. Even if someone does so well enough that their articulation is widely adopted, it still lasts only until the next

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change in the framework, data availability, statistical techniques, or phenomena needing explanation. Still, paradigms are very aggressive in defining crebit. A statement that doesn’t use the theories and methods of a paradigm is “not even wrong” and is thus excluded as crebit. Because paradigms are so narrow, they tend to co-exist within disciplines. For example, accounting has paradigms for financial-archival, behavioral-experimental, economicexperimental, economic-analytical and sociological-qualitative communities, which live side by side in the pages of this journal, even though their paradigms differ substantially. Scholarly communities also treat matters as crebit if they are not sufficiently diplomatic. Accounting scholars who correct others’ errors typically take great care to frame their efforts as ‘extensions’. For example, Jung and Kwon (1988) published an ‘extension’ of Dye (1985) that differed only by using a Bayesian analysis for one inference, without once mentioning that a Bayesian approach was widely accepted as the correct approach at the time Dye’s paper was published. While we can’t know whether the paper would have been published with less diplomatic framing, survey results from Bloomfield, Rennekamp, & Steenhoven (2018) document many published accounting scholars expressing the belief that they wouldn’t be able to publish replications of prior work because it would offend the original authors and others in their scholarly community. Diplomacy is more important in fields that address issues more controversial than accounting, as demonstrated by scholars’ attempts to punish authors, editors and journals for statements comparing racial identity to gender identity (Tuvel, 2017) and defending colonialism (Gilley, 2017). While critics argue that these articles fall short on several characteristics, diplomacy is clearly an important one. Scholarly communities rarely acknowledge that they treat matters as crebit out of a sense of self-preservation, but it would be surprising if they did not. Those who oversee peer-reviewed journals seem to expect individual scholars to exclude matters that undermine their own supporters, given that they so often require authors to disclose their sources of funding. I would certainly expect my editor to look carefully for compensating virtues like relevance and helpfulness before allowing me to use these pages to criticize the sponsors of this conference (Deloitte and Touche, LLP). 2.6. Business meetings and dinner parties Business meetings and dinner parties are events with a range of purposes. But as venues for productive conversation, both have quite narrow goals. The ideal meeting has a clear agenda specifying one topic at a time to be discussed productively. The ideal dinner party has a clear (if unstated) agenda of strengthening social bonds among attendees. The tight focus on a singular goal leads both venues to impose high thresholds for diplomacy, and thus rule out vast topics likely to cause offense (e.g., don’t talk about politics or religion). Because the goal of a business meetings is decisionmaking, their LAAPs demand a high level of faithfulness, so that decisions are not based on faulty input. Faithfulness is not particularly important at dinner parties, which are often filled with dubious statements that nonetheless foster social connection (“I had a lovely time”). Business meetings also have captive audiences, while dinner parties do not, causing their LAAPs to demand higher levels of efficiency but lower levels of engagement. 3. Bragging, humblebragging and crebitry Grant et al. (GHS) allow a useful case study in how a framework of LAAPs and their crebit can be used to interpret audience responses to potentially offensive statements, and to make testable predictions on how variations in environmental factors will change

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the thresholds that determine what statements are viewed as crebit. GHS use laboratory experiments (as defined in Bloomfield, Nelson, & Soltes, 2016) to study how responses to bragging, modesty, and humblebragging differ across conference calls and Twitter. They define bragging as claiming credit for good outcomes while using intensifying language, and modesty as giving credit to others without intensifying language. They define humblebragging as “making a seemingly modest statement that is meant to draw attention to one’s admirable or impressive qualities or achievements.” Their key dependent variables are participants’ interest in investing in the firm and their assessment of management credibility. GHS find that student participants become less inclined to invest in a firm when the CEO brags on Twitter, but not nearly so much when they brag in a conference call, and that this effect operates at least partly through assessments of manager credibility. A supplementary experiment with participants drawn from Amazon Mechanical Turk shows that intensifying language has an effect separate from claims of credit. They find much more negative responses to humblebragging regardless of venue, which they interpret as reflecting the perceived dishonesty of pretending to be humble while actually bragging. GHS interpret their results on bragging and modesty as reflecting participants’ differing expectations across the two venues. They argue that people do not like their expectations to be violated, and therefore respond negatively when the CEO is modest in conference calls, where they should be proud, and when the CEO brags on Twitter, where they should be modest.

3.1. Interpretation I take the results reported by GHS at face value, so that I can focus on interpreting their study in terms of LAAPs, crebit, and crebitry. In any venue, statements about who caused good outcomes risk undermining productive conversations about performance by threatening audience members’ status; bragging effectively says “I am better than you” to those who don’t identify closely with the speaker, and therefore do not share in their success. The LAAP for conference calls imposes a fairly low threshold for diplomacy, because barriers to attendance and their unengaging nature cause them to attract mostly analysts and active investors who care deeply about performance (and so care relatively less about status), and who are likely to identify reasonably closely with the CEO due to their frequently longstanding relationships and mutual dependence (each needs to stay in the good graces of the other to do their job well). The LAAP for a firm’s Twitter community imposes a much higher threshold for diplomacy because Twitter is designed to be highly engaging and accessible. It therefore attracts an audience that cares less about performance (and therefore relatively more about status), and who are likely to identify far less with CEOs due to their lack of longstanding relationships and different social station. Bragging is therefore more likely to cause offense on Twitter, and thus more likely to be viewed as and punished as crebitry. This effect is likely exacerbated because part of Twitter’s engagement strategy is also to focus people on status, as measured by followers and retweets. A similar argument explains why participants view humblebragging negatively in both settings. I will use a slightly different definition of humblebragging than GHS, which follows Sezer, Gino, & Norton (2018): statements are humblebrags when they pair a claim of credit with a claim that evokes sympathy. Those who identify exceptionally closely with the speaker will be able to feel sympathy while also sharing in reflected success, but this audience is probably limited to family and close friends.

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3.2. Extensions and predictions My interpretation of GHS is composed of many distinct claims, each of which could be tested to assess the predictive power of the LAAP-crebit framework. I now propose some extensions of GHS to test some predictions that share one essential feature: they test whether changes in the venue change participants’ beliefs that bragging might undermine the conversation by offending other audience members, not merely because they are more personally offended by the statement themselves. Establishing this fact is essential to distinguishing the LAAP-crebit framework from frameworks relying on the Gricean pragmatics of language (e.g., Stanford Encyclopedia of Philosophy, 2014), which predict that people will interpret the meaning of a statement differently in different venues. In contrast, the LAAP-crebit framework predicts that people will define the limits of crebitry differently across different venues, even if they interpret the meaning of the statement in the same way. My interpretation of GHS relies most heavily on two differences in participants’ beliefs about audiences in Twitter communities and conference calls: how much audience members care about status, relative to performance, and how much audience members identify with CEOs. Ideally, experimental tests would hold constant the venue itself as much as possible, so that it is more likely they are changing only one factor at a time. For example, an experiment could present scenarios that all depict the CEO bragging to a Facebook group, and manipulate the rules that govern who can be a member of the group. The scenario could vary the rules themselves to test whether more open rules lead participants to expect audience members to care more about status and identify less with the CEO, and then test whether those expectations lead to more negative reactions to bragging. Alternatively, the scenario could directly manipulate descriptions of the audience. A similar approach could be used to examine responses to humblebragging, with one condition describing an audience that identify extremely closely to the CEO, in order to create a setting in which humblebragging is tolerated. One possibility would be to manipulate the celebrity of the CEO. Future research might also examine the impact of ‘conversational bandwidth’. It is easier to be diplomatic in rich face-to-face conversations or extended essays than through email or 140character Twitter posts. The difficulty of diplomacy might lead bragging to be seen as a more serious threat to conversational productivity, but might also cause listeners to give the speaker more benefit of the doubt. While my own experience with email conversations suggests that the latter is unlikely, these predictions could be tested using manipulations somewhat like that of Bennett and Hatfield (this issue), but manipulating bandwidth within a single platform. One could test whether participants asked to claim credit do so more diplomatically under Twitter’s new 280character limit than under the old 140-character limit, or test whether a similar 140-character brag is treated differently when the character limits are different. Claims of credit may seem less like crebitry when they come from independent sources who don’t have a direct interest in the status of the managers. It would be straightforward to manipulate who speaks (the manager or another party) in a venue. It would be more difficult, but perhaps more interesting, to manipulate the credibility of the independent source. Glassdoor, studied by Hales, Moon & Swenson (this issue), provides a promising setting. Glassdoor publishes anonymous reviews of large companies by their employees. As part of their LAAP, Glassdoor requires that reviewers offer both positive and negative views, which is likely to increase both the credibility and diplomacy of their reviews. Relaxing this rule should therefore make third-party attributions of

credit seem less like crebitry. Finally, future research could examine the impact of audience sophistication. Most accounting studies, including Baginski, Demers, Kauser, and Yu (this issue), define sophistication as an ability to process complex and technical disclosures. In the context of bragging, however, other definitions of sophistication would be more useful. Sophisticated investors should be more invested in understanding performance, and be less distracted by perceptions of status-grabbing. They should also be more aware that it isn’t rational to ‘punish’ managers for crebitry by disinvesting from a competitive market. Doing so sacrifices returns, but in a competitive market has no effect on market prices. Future research could use archival and experimental methods to distinguish among these notions of sophistication and assess their impact. 4. Social media and college campuses public discourse Twitter feeds, Facebook shares, and Youtube comment threads are notorious for the low quality of their discourse, while college campuses are becoming notorious for acrimony over what speech they should permit and forbid. In this section, I argue that both problems arise because no one polices and punishes crebitry, and apply the framework in this paper to propose some remedies for the latter. 4.1. Social media Social media is constantly undermined by crebitry. While many of those commenting on Twitter, Facebook, Youtube and other internet venues contribute relevant and interesting remarks, conversations are undermined so often and in so many ways that online communities have developed a complex nomenclature to describe forms of crebitry. Consider a website that seeks to provide a venue for productive conversations among those who own and love cats. Their conversations are likely to be undermined by those who want to foster a preference for dogs (haters), as well as those who simply enjoy undermining conversations for its own sake (trolls). They can expect these haters and trolls to raise faulty arguments about the evils of cats faster than they can be rebutted (the Gish Gallop); to pretend sincerity in asking repeatedly for evidence on the benefits of cats (sealioning); to respond to persuasive responses to one argument by changing the terms of their argument (goalpost shifting, Calvinball); to divert discussions about one benefit of cat ownership by insisting it be balanced by a discussion about a benefit of dogs (whataboutism, justaskingquestions, and bothsiderism); to threaten community members with death and rape, and/or publish their contact information (doxxing); and to pretend that a statement is more offensive than it is (concern trolling). These problems persist because no one is stepping up to police and punish behavior that would be viewed as crebitry under any reasonable LAAP. Regulators have declined to impose LAAPs on social media platforms because doing so might violate the First Amendment of the U.S. Constitution, and even if it did not, would require aggressive governmental action. The platforms themselves have declined to impose LAAPs because treating some content as crebit would make them broadcasters, rather than platforms, and thus expose them to legal liability for all of the content they publish.2 Most online communities, like blogs and Facebook groups, don’t impose LAAPs because they lack the time, effort, personnel, and technology to do so. Regulators and platforms are slowly imposing LAAPs to address

2

See https://www.eff.org/issues/cda230/legislative-history.

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extreme forms of crebitry (like death threats), but the task of policing and punishing crebitry will almost surely fall primarily to those who moderate content in online communities, who can articulate their community’s LAAP clearly, remove crebit as quickly as possible, and ban those who repeatedly engage in crebitry.3 Platforms can help by providing moderators with tools that help them automate the removal of what the community views as crebit, and help them pierce anonymity to identify repeat offenders. 4.2. Campus speech Those who police and punish crebitry for their online communities can expect controversies similar to those currently facing college campuses. Campuses are filled with narrow LAAPs that each exclude a great deal of content as crebit. Teachers implement classroom LAAPs that focus conversation on their subject material. Researchers implement LAAPs that focus conversation on their paradigms. Administrators and student groups implement LAAPs that focus conversations on topics and speakers that interest them. These narrow LAAPs have been controversial since they were promoted by Wilhelm Von Humboldt in 19th-century German universities to allow productive conversations in highly specialized disciplines. Narrowness allows scholars to rely more heavily on frameworks tailored to specific questions, but can lead to ossification and irrelevance by shutting out views that would improve their frameworks, connect them to other disciplines, and apply them to issues of practical importance (Lohmann, 2006). Unfortunately, conversations over appropriate LAAPs for campus settings have become unproductive, for much the same reasons seen on the social media platforms where they often take place: no one is policing and punishing crebitry. No LAAP is above criticism. They may define crebit too narrowly or too broadly because they place too much value on some purposes and too little on others, or because the LAAP implements those values poorly. If conversations about campus LAAPs are to be productive, they will need to take place in venues that impose and enforce LAAPs for that purpose. The LAAP is likely to look fairly similar to the framework presented in this paper, much as FASB (1980, 2010) has implemented their Conceptual Framework as a LAAP for conversations about GAAP. Those who wish to influence FASB’s decisions will be most successful if they frame their arguments in terms of relevance, faithfulness, and other terms articulated in the Conceptual Framework. It would be crebitry to argue that ‘My firm will be poorer if this standard passes.’ Even if that statement is faithful, it is intelligible or relevant in light of FASB’s framework. While many have criticized the Conceptual Framework and how it is applied to specific standards, the more general theory is sound: discussions about GAAP will be more productive if they are governed by an appropriate LAAP. 4.3. Defining crebit for debates about LAAPs on campus To illustrate the value of the LAAP-crebit framework, I assume that campus leaders meet in private to determine how to set LAAPs for various campus venues, and discuss three types of arguments I would exclude as crebit to make those conversations more productive. First Amendment Arguments. Americans whose speech is excluded from a LAAP as crebit often argue that this is a violation of their First Amendment rights, perhaps by citing Supreme Court Justice Louis Brandeis’ famous suggestion that the remedy to bad

3 Guidelines for doing this are provided by http://anildash.com/2011/07/if-yourwebsites-full-of-assholes-its-your-fault.html.

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speech is “more speech, not enforced silence” (Whitney v. California, 274 U.S. 357, 1927). However, First Amendment arguments almost never apply when the university restricts speech in a particular venue, for exactly the reasons articulated by Brandeis when quoted in full: “If there be time to expose through discussion the falsehood and fallacies, to avert the evil by the processes of education, the remedy to be applied is more speech, not enforced silence.” This qualification underscores the reason we have LAAPs. People engaged in productive conversation simply don’t have the time to address every falsehood and fallacy introduced by a Gish Gallop; the same goes for the other forms of crebitry common in online settings. For example, in a seminar analyzing the effects of cat vocalizations on human happiness, participants have little time to offer someone who is just asking questions like “what about cats’ role in spreading toxoplasmosis?” While toxoplasmosis is relevant to conversations about the relative superiority of cats and dogs, it is not relevant to the narrower question to which the seminar is dedicated. Universities have been able to foster productive speech specifically because they divide themselves into a host of small LAAPs that each aggressively exclude crebit and punish crebitry. As long as a LAAP can be reasonably defended as fostering productive conversations, no one has a constitutional right to violate it within that venue. As with Rule 304 of the Federal Rules of Evidence, most First Amendment arguments can be excluded as crebit due to “undue delay, wasting time, or needlessly presenting cumulative evidence.” Noncompensatory Arguments. LAAPs treat a matter as crebit if it falls below the threshold for some characteristics without compensating strengths on others. However, many of the loudest arguments about campus speech place no value on some characteristics and maximal value on others. Some arguments place no value on diplomacy, calling students and faculty “snowflakes” who don’t understand that “facts don’t care about your feelings” or place no value on support for the venue, branding administrators who demand “civility” as corporate tools who punish faculty for expressing views that displease donors. Even ignoring that both arguments are worded undiplomatically enough to undermine a conversation about campus LAAPs, they are also unfaithful representations of the nature of LAAPs and their exclusions. People are emotional creatures, and statements that trigger sufficiently emotional responses undermine productive conversation. Colleges are costly venues, and statements that sufficiently offend donors will undermine their continued existence. Any reasonable LAAP will therefore treat sufficiently offensive statements as crebit if they are not also sufficiently relevant, faithful, helpful, supportive, etc. There are good reasons to be concerned about sweeping definitions of crebit based on diplomacy, but to argue that no statement is too offensive to be said in any venue is mere crebitry. Venue Disruption. Over the last few years, many students have communicated their desire for campus LAAPs to exclude more speech as crebit (or police and punish crebitry more effectively) by disrupting campus venues. Disrupting a venue is crebitry relative to the venue’s LAAP, because (like trolling) its very purpose is to undermine the productivity of the intended conversation. It is also crebitry relative to the LAAP that should govern conversations about campus LAAPs. Disruption causes harm to parties valued by those who organize these discussions, including speakers, audiences, and venue managers. It is offensive enough to undermine productive discourse about appropriate LAAPs. It should therefore be policed and punished. This is not to say that every venue’s LAAP must be defended. Our government devotes considerable energy to undermining productive conversations among criminals and hostile foreign powers, and does so with strong public support. Rather, venue disruption is punishable because students are taking it upon

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themselves to undermine others’ conversations. As with most protest behavior, being punishable doesn’t make disruption “wrong.” Like Gandhi, Rosa Parks, and Thomas Paine, history may judge their cause to be just. 5. Directions for accounting scholarship This paper offers a framework for understanding the norms that allow productive discussion in a range of venues, from financial statements to dinner parties. My inspiration for the framework was drawn from my study of accounting, which is why I have called these norms LAAPs, and called the matters they exclude crebit (since crebit is excluded from financial accounts). However, I have asserted, rather than documented, that my framework can explain why LAAPs and their crebit look as they do. I hope that future work will examine these issues in more detail, perhaps by examining historical changes in accounting standards or other conversational norms, by conducting experimental studies such as those I have described in section 3, or by conducting qualitative research that would more directly illuminate why people view certain topics and statements as more inappropriate in some venues than in others. I have also asserted, rather than documented, that the eight characteristics in my framework are operational, comprehensive and parsimonious, as recommended by Joyce, Libby & Sunder (1982). Given that those authors provided evidence that most of the characteristics listed in FASB (1980) failed those tests, even after extensive deliberation by many experts, the framework presented here will surely need to be refined. Empirical testing is likely to be challenging, in part because people may act as if they rely on characteristics that are easier to understand, much as readers of financial statements judge relevance partly on the basis of reliability in the experimental study by Kadous, Koonce, & Thayer (2012). In my expanded framework, we might expect similar conflation of diplomacy and helpfulness, since statements that derail conversations by causing offense are often seen as causing direct harm to those who are offended (e.g., Barrett, 2017). I also hope that this paper will give accountants something to offer other disciplines that study conversational norms. Accounting often seems like a scholarly version of Starbucks UK. This Starbucks subsidiary owns almost no intellectual property; it pays top dollar for Starbucks coffee, the Starbucks brand, and Starbucks’ patented business practices from another subsidiary, so that its only valuegenerating activity is to serve coffee. It has never turned a profit doing so. In much the same way, we pay top dollar in the scholarly currency of citations to import theories from finance, economics, and psychology, so that our only value-generating activity is to document how those theories apply to accounting institutions. We have never turned a profit doing so, as measured by the small number of citations we garner from other disciplines. The LAAP-crebit framework could help accountants reverse this trend, by allowing us to develop intellectual property that lies solidly inside accounting, which can be tested by documenting how well the theory applies to non-accounting institutions. Thus, this article provides a response to calls by Demski (2007), Fellingham (2007) and Hopwood (2007) to place accounting more solidly within the academy of scholarship by providing a distinctive approach to investigating matters of interest to other scholars. Such an approach will require further work to distinguish a theory of LAAPs and their crebit from related theories about conversational norms drawn from other fields, particularly Gricean pragmatic theories of language and its successors (Stanford Encyclopedia of Philosophy, 2014). These theories emphasize conversational norms of relevance, truthfulness, completeness, and “manner” (which includes clarity and brevity). However, the LAAP-crebit framework differs from pragmatics in several key ways.

Pragmatics typically assumes that speakers and their audiences share similar interests, which is rarely true settings of interest to accountants. Pragmatic theories of language also focus primarily on how conversational norms shape the interpretation of what is said and not said. In contrast, the LAAP-crebit focuses on how norms exclude and punish speech in the service of productive conversation. This focus seems to have a distinctly accounting flavor to me, but further work will be needed to establish this claim more soundly. Acknowledgements I am grateful for input from Tamar Bloomfield, Robert Libby (Editor), and Blake Steenhoven. References AIS. (2018). What is the johnson model of intervention?. Retrieved from: http:// www.associationofinterventionspecialists.org/what-is-the-johnson-model-ofintervention/. Attfield, S., Kazai, G., Lalmas, M., & Piwowarski, B. (2011). Towards a science of user engagement (Position Paper). Baginski, S., Demers, E., Kauser, A. & Yu, Y (this issue). Linguistic tone and the small trader. Accounting, Organizations and Society (this issue). Barrett, L. (2017). When is speech violence?. Retrieved from https://www.nytimes. com/2017/07/14/opinion/sunday/when-is-speech-violence.html. Bennett, G.G. & Hatfield R. (this issue). Staff auditors’ proclivity for computer mediated communication with clients and its effect on skeptical behavior. Accounting, Organizations and Society (this issue). Bloomfield, Robert, Nelson, Mark W., & Soltes, Eugene (May 2016). Data for archival, field, survey, and experimental accounting research. J. Acc. Res., 54(2), 341e395. https://onlinelibrary.wiley.com/doi/abs/10.1111/1475-679X.12104Gathering. Bloomfield, R., Rennekamp, K., & Steenhoven, B. (May 2018). No system is Perfect: Understanding how registration-based editorial processes affect reproducibility and investment in research quality. Journal of Accounting Research, 56(2), 313e362. Demski, J. S. (2007). Is accounting an academic discipline? Accounting Horizons, 21(2), 153e157. Dye, R. (1985). Disclosure of nonproprietary information. Journal of Accounting Research (Spring), 123e145. FASB. (1980). Qualitative characteristics of accounting information. Statement of financial accounting concepts No. 2. Norwalk, CT: FASB. FASB. (2010). Conceptual framework for financial reporting. Chapter 3, ‘‘Qualitative characteristics of useful financial information.’’ statement of financial accounting concepts No. 8. Norwalk, CT: FASB. Fellingham, J. C. (2007). Is accounting an academic discipline? Accounting Horizons, 21(2), 159e163. Gilley, B. (2017). The case for colonialism. Third World Quarterly. https://www. tandfonline.com/doi/abs/10.1080/01436597.2017.1369037. Grant, S., Hodge, F., & Sinha, R. (2018). How disclosure medium affects investor reactions to CEO bragging, modesty, and humblebragging. Accounting, Organizations and Society (this issue). Hales, J., Moon, J. and Swenson, L. (this issue). A new era of voluntary Disclosure? Empirical evidence on the informativeness of rank and-file employees’ business outlook. Accounting, Organizations and Society (this issue). Hopwood, A. (2007). Whither accounting research? The Accounting Review, 82(5), 1365e1374. Johnson, V. E. (1973). I’ll quit tomorrow. Harper & Row. Joyce, E., Libby, R., & Sunder, S. (1982). Using the FASB’s qualitative characteristics in accounting policy choices. Journal of Accounting Research, 20(2), 654e675. Part II (Autumn). Jung, W., & Kwon, Y. (1988). Disclosure when the market is unsure of information endowment of managers. Journal of Accounting Research (Spring), 146e153. Kadous, K., Koonce, L., & Thayer, J. (2012). Do financial statement users judge relevance based on properties of reliability? The Accounting Review, 87(4), 1335e1356. Kuhn, T. S. (2012). The structure of scientific revolutions. University of Chicago Press. Lohmann, S. (2006). The public research university as a complex adaptive system. In Proceedings of the European conference on complex systems, University of Oxford, september 25e29. Reuters. (2018). The essentials of reuters sourcing. Retrieved from: http://handbook. reuters.com/index.php?title¼The_Essentials_of_Reuters_ sourcing&oldid¼7964. Sezer, O., Gino, F., & Norton, M. I. (2018). Humblebragging: A distinctdand ineffectivedself-presentation strategy. Journal of Personality and Social Psychology, 114(1), 52. SPJ. (2018). SPJ code of ethics. Retrieved from: https://www.spj.org/ethicscode.asp. Stanford Encyclopedia of Philosophy. (2014). Implicature. Retrieved from: https:// plato.stanford.edu/entries/implicature/. Tuvel, R. (2017). In defense of transracialism. Hypatia, 32(2), 263e278.

Please cite this article in press as: Bloomfield, R., , The LAAPs that foster productive conversations and the crebit that undermines them, Accounting, Organizations and Society (2018), https://doi.org/10.1016/j.aos.2018.06.004