New Schulich Research Reveals the Double-Edged Nature of CEO Promises
TORONTO – Friday, April 10, 2026 – New research from York University’s Schulich School of Business reveals that when CEOs make public promises about their company’s future, they may boost investor confidence – but at a significant cost to strategic flexibility.
Published in the Strategic Management Journal, the article, “Shaping expectations, losing flexibility: A study of CEO promises as strategic communication tools,” is co-authored by Majid Majzoubi, Assistant Professor of Strategic Management at Schulich, alongside Alex Murray (Lundquist College of Business) and William J. Mayew (Fuqua School of Business).
The research introduces a new framework for understanding CEO communication, showing that promises function as a powerful – yet risky – strategic tool.
“CEO promises are not just words – they’re commitments that shape how investors, analysts and stakeholders evaluate a firm’s future,” said Professor Majzoubi. “Our research shows that while these promises can build confidence and momentum, they also bind organizations to a specific path, making it harder to adapt when conditions change.”
Drawing on more than 69,000 earnings call transcripts from S&P 1500 firms between 2010 and 2022, the researchers used advanced Large Language Models (LLMs) to identify over 74,000 CEO promises – creating the first large-scale database of its kind.
The findings highlight a fundamental tension in executive decision-making. CEOs are more likely to make promises when they need to boost credibility – such as early in their tenure, after missing earnings targets, or when facing external scrutiny. However, in uncertain or volatile environments, they often scale back or rely on what the study calls “strategic ambiguity.”
“In periods of uncertainty, CEOs don’t necessarily stop communicating about the future,” said Prof. Majzoubi. “Instead, they adjust how they communicate – making promises that are broader, less specific, and tied to longer time horizons. This allows them to manage expectations while preserving room to manoeuvre.”
The study also finds that failing to deliver on public commitments can carry serious consequences. Broken promises can damage credibility, trigger negative reactions from analysts and media, and significantly increase the likelihood of CEO dismissal.
“A promise creates a kind of ‘strategic debt,’” added Prof. Majzoubi. “Once it’s out there, stakeholders expect it to be fulfilled. If it isn’t, the reputational costs can be substantial – not just for the firm, but for the CEO personally.”
Beyond its theoretical contributions, the research demonstrates the growing role of artificial intelligence in business scholarship. By leveraging LLMs to analyze complex language patterns at scale, the study opens new avenues for understanding corporate communication and decision-making.
The findings carry important implications for both executives and boards. While promises can help shape market expectations and attract investment, they must be used carefully, particularly in uncertain environments where flexibility is critical.
“Effective leadership communication isn’t just about inspiring confidence – it’s about calibrating commitments,” said Prof. Majzoubi. “The most effective CEOs understand when to make clear promises and when to leave space for adaptation.”
