Heterogeneity Tests.

Digitalization is anticipated to substantially improve information transparency and enhance the capital market’s information environment. However, during the initial phase of digital transformation, companies face challenges in achieving high-quality information disclosure. This is because digital technology implementation and organizational adjustment are still at early stages. Concurrently, investors face difficulties in assessing the accuracy of disclosed information. This challenge provides management with the opportunity to overstate the benefits of digital transformation. This study investigates the impact of corporate digital transformation on management’s tone manipulation behavior, using a sample of Chinese A-share listed companies from 2012 to 2021. Findings indicate that corporate digital transformation significantly fosters management’s tone manipulation during its exploration phase. Media slant positively moderates this relationship. Further analysis supports the paper’s hypothesis: companies with weaker financial flexibility and lower risk information disclosure levels show a stronger positive correlation between digital transformation and tone manipulation. Concurrently, mechanism analysis reveals that management overconfidence partially mediates the relationship. This suggests that digital transformation increases managerial overconfidence, thereby promoting tone manipulation. The conclusion offers new insights into enhancing management discussion and analysis information disclosure quality from a corporate strategic transformation perspective. It serves as a valuable reference for accurately identifying misleading management signals.