He's also been known to branch out from this finance work. In an article that just appeared in Corporate Reputation Review—brainstormed over lunch with a colleague, Janice Lawrence, a U.N.L. accounting professor—he looked at a rather underexplored area: CEO letters in annual shareholder reports. These often humdrum missives ("pretty dry stuff," Lawrence says) tend to put a glossy spin on company numbers and would seldom be considered must-read literature (unless they're written by that fellow Nebraskan, Warren Buffett).
But Geppert and Lawrence found something interesting in the letters: CEOs at firms independently rated as "high reputation" tend to use a different style of language. They use shorter words and clearer, concrete language, whereas CEOs at firms with less impressive reputations employ muddled prose and buzzwords. For example, a high-reputation firm's CEO wrote (a few years ago), "As a leading provider of low-cost mortgage capital for home buyers to finance their homes, our firm is at the center of the housing industry, one of the strongest growth sectors in America." This is quite easy to understand. A CEO at a less stellar firm, by contrast, stated, "…we remain committed to being good stewards of our asset base and to taking action regarding underperforming assets wherever possible." What assets? What does it mean to be a good steward? It's much more ambiguous.
Even though these letters go through several screens of lawyers and public relations people, "I think [the high-reputation CEOs] are being more straightforward, and it just comes out naturally," Geppert says. (Although Buffett is known for being straightforward, Geppert won't comment on the "Sage of Omaha's" shareholder letter, noting that it's a little long for a quick study).
This research is useful, Lawrence says, because "accounting fraud is everywhere right now." Executives always have the opportunity and the motivation (for example, producing better numbers) to commit fraud. "The big hurdle in stopping fraud is knowing about the attitude" coming from the top, she says. Their results can potentially help auditors analyze CEO shareholder letters for clues as to which companies merit a closer look.
Working on this study with Geppert was fun, Lawrence says, because he has "a very inquisitive mind." He's the kind of guy that, "for a hobby in his spare time, will go take more statistics courses."
Also in his spare time: Weaving, says Geppert, who has had some of his work shown in galleries in the Lincoln area: "I've always thought that the mechanics of looms were interesting, and weaving combines aesthetics with the mathematics of pattern."