Proof that the pronouns “I,” “we,” and “you” improve not just your writing, but your stock price

Graphic: Wall Street Journal

One of my simplest and most powerful tips is to use “I,” “we,” and “you” in your business writing. Now researchers at the A. B. Freeman school of Business at Tulane have proven my point.

As described in the Wall Street Journal, Zhenhua Chen and Serena Loftus of Tulane conducted pairs of simulated earnings calls. One set of respondents heard the executives describe their actions with “I” and “we” and “our,” while the other heard a call without such pronouns. Investors who heard the calls were more likely to invest if they heard the executives use personal pronouns. The researchers also confirmed the effect by reviewing transcripts of 50,000 actual earnings calls and comparing them to subsequent stock moves.

Why does this happen?

Here are some hypotheses from the article:

Serena Loftus, an assistant professor at Tulane’s Freeman School of Business and co-author of the study along with Zhenhua Chen, a professor of accounting at Tulane, says investors may not be aware of the effect self-inclusive language has on their investment decisions. They often are so attuned to what is being discussed—such as profits and losses—that pronouns slip past their conscious mental radar, she says.

But first-person pronouns make their mark because they create the impression that an executive has more control over the past and therefore more ability to influence the future, she says.

James Pennebaker, a professor of psychology at the University of Texas at Austin and the author of “The Secret Life of Pronouns,” agrees that an executive’s use of personal pronouns might create a more positive impression among investors.

But he believes the study’s explanation might be missing the mark. He says that words like “I,” “me” and “my” create an air of vulnerability, which listeners tend to find authentic and accessible. “The way I interpret it is that the manager’s coming across as more human,” Prof. Pennebaker says.

Why personal pronouns actually work

I’ve looked at all business writing, not just earning calls, and I think the reasons for this effect are not what Loftus or Pennebaker think they are.

When you write or speak with the personal pronouns, “I,” “we,” and “you,” you humanize business communication. Business communication is always about a relationship between the writer, their company, and the audience (which might be customers, employees, or investors). With personal pronouns, you emphasize that relationship. We are going to do something. I have confidence in it. You should take action.

Naturally the audience pays closer attention, just as they would if you were standing in front of them having a conversation. You constantly involve the audience; you take responsibility for your statements. This creates relevance for the audience. It works.

So why don’t business writers and other executives do this more often? They want to treat business as a professional activity. They want to describe it. If it’s bad news, they want to distance themselves from it; if it’s good news, they don’t want to sound egotistical.

The result is more like looking at painting than having a conversation. Subject to a communication like that, readers or listeners are less likely to pay close attention. Their minds wander. And the communication is less effective.

It’s not the implication of control, as Loftus suspects, or an air of vulnerability, as Pennebaker comments. It’s the simple effect that pronouns have on communication: they make people listen.

Here’s my assignment for you. The next time you write something, use the word “you” in it, at least two or three times in the first 5 paragraphs. You’ll have to think about who the audience is, but that’s a good idea in any case.

Once you master that, start using “we” to refer to your company, your department, or your staff. You’ll find it follows naturally once you’re using “you.”

These are easy fixes. Do them four or five times and you’ll make them a habit. It’s the easiest way to make your writing more authentic.

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  1. Amen. Conversation and relationship.
    When you refer to your business name rather than “we” you build a figurative wall around your business. It becomes this big thing, unthinking and acting as one monolithic body, rather than a collection of real people who want to interact with customers.
    People already know what company they’re interacting with. Especially if they are on your website, watching a video or presentation in which your logo appears, or reading any written material. There is no value in constantly repeating the name of the company rather than using more personal language.

  2. I love this, especially your comment that corporate writers tend to omit personal pronouns when they are trying to distance themselves … which also ends up giving the impression that they don’t hold themselves accountable, either.

    Another bonus benefit of using ‘I,’ ‘we’ and ‘you’ is that it encourages the writer to use more verbs in some cases, making the message more active rather than passive: compare a heading that says ‘Reorganization of the team’s functions’ with one that says ‘We are reorganizing the team’s (or better yet, ‘your’) functions.’

    The only nuance I find that needs attending to with the word ‘we,’ which can end up sounding like the Royal We if we use it repeatedly (or if we still address the reader as ‘our employees’ or ‘our customers,’ instead of simply addressing them as ‘you.’).

    The need to keep our writing sounding like humans speaking to other humans is what got me into the plain language field in the first place. Thanks for giving us some recent evidence to use as ammo!