Finance/Accounting Seminars: Kai Li

About Kai Li

Dr. Li, a Fellow of the Royal Society of Canada (Class of 2022), holds the Canada Research Chair in Corporate Governance and W. Maurice Young Endowed Chair in Finance at the UBC Sauder School of Business, University of British Columbia. She was also Senior Associate Dean, Equity and Diversity between 2015-2021.

Dr. Li’s research focuses on the economic consequences of corporate governance mechanisms. Her current research projects explore: (1) gender, competition, and performance, (2) machine learning in finance, and (3) gender and finance. Her research has appeared in Journal of Finance, Journal of Financial Economics, Review of Financial Studies, Journal of Financial and Quantitative Analysis, Management Science, Journal of International Business Studies, and many other leading journals in Finance and Economics. She is the recipient of the UBC Killam Research Award, the Sauder School of Business Research Excellence Award (both junior and senior categories), and the Barclays Global Investors Canada Research Award, a Senior Fellow of the Asian Bureau of Finance and Economic Research, a Research Member of the European Corporate Governance Institute, and a Research Fellow of the FinTech at Cornell Initiative. She is a Managing Editor of Journal of Financial and Quantitative Analysis, and is on the Editorial Board of Journal of International Business Studies, Journal of Financial Intermediation, Journal of Financial Stability, and Pacific-Basin Finance Journal. She has also served on the Editorial Board of Review of Financial Studies, Review of Finance, Management Science, Journal of Corporate Finance, Journal of Banking and Finance, and Financial Management. Her research has been featured in Wall Street Journal, New York Times, Washington Post, Financial Times, The Time Magazine, Reuters, CNBC, Bloomberg, Dow Jones Newswire, New Yorker, BBC, BNN, CBC National, CTV National News, National Post, Globe and Mail, U.S. News & World Report, Harvard Business Review, and Yahoo! Finance.

Dr. Li will present her paper Dissecting Corporate Culture Using Generative AI – Insights from Analyst Reports.

Abstract

Our study is among the first in finance, accounting, and economics to apply generative AI models as reasoning agents on analyst reports to gain insights into analysts’ views of corporate culture. We employ generative AI (ChatGPT) to analyze 2.4 million analyst reports between 2000 and 2020. Generative AI organizes analysts’ views into a knowledge graph that links different cultural values to their perceived causes and effects. In terms of influencing factors for corporate culture, analysts identify business strategy as a key factor for a large number of cultural values – customer-oriented, operations-oriented, innovation, results-oriented, adaptability, integrity, and risk control; and management team for teamwork, innovation, results-oriented, adaptability, integrity, risk control, and people-oriented values. In terms of business outcomes shaped by corporate culture, analysts identify innovation and adaptability as affecting almost all aspects of business operations, ranging from market share and growth to corporate ESG practices, while other values such as customer-oriented, operation-oriented, or people-oriented have less impact on business outcomes. We further provide evidence that analysts’ views of culture are distinct from values presented on corporate websites, and/or from the views of executives and employees. Finally, we show that analysts’ views of corporate culture are reflected in their stock recommendations and target price forecasts as well as impact price reactions to the release of their reports. We conclude that analysts’ research on corporate culture offers new insights into its causes and effects, and that we are closer to establishing the culture-firm value link.