AI Employment and Political Risk Disclosures in Earnings Calls with Erdinç Akyıldırım & Steven Ongena

Date: November 20, 2025 - Thursday

Time: 14:00 

Place: santralistanbul Campus, L1- 209

Speaker: Gamze Öztürk Danışman

Abstract:

Using a panel of 929 U.S. publicly listed firms, this paper examines the relationship between artificial intelligence (AI) employment and the disclosure of political risk in corporate earnings calls. Our findings suggest that firms with greater AI employment tend to disclose less information about political risk during earnings calls. We propose a dual mechanism that underpins this association. First, AI enables narrative management: firms might use AI tools to alter the tone and wording of disclosures, potentially avoiding phrases that could produce unfavorable sentiment, leading to a reduction in reputational risk. Second, AI is associated with improvements in firms’ internal performance and risk management, which may reduce the need for voluntary political risk disclosures. Our findings add to the literature on voluntary disclosure and the economic implications of AI by indicating that AI, as a general-purpose technology, has unintended consequences for corporate transparency. These findings may pose challenges for corporate transparency in the AI era, highlighting the importance for investors and regulators to carefully consider how disclosure practices are affected.