A group of researchers have looked into how the language spoken in an organisation affects its corporate future orientation, and practices such as CSR and R&D.
The study is based on the Sapir-Whorf hypothesis that argues that language has an influence on people’s behaviour and way of thinking; and looks at future-time reference (FTR) languages i.e. those which require speakers to use a different tense when speaking of the future.
The findings suggest that companies with strong FTR languages (such as English, French and Spanish) as their official language have less of a corporate future orientation, as compared to those in weak-FTR language (such as German) environments.
Additionally, companies with strong FTR languages as their working language engage less in CSR and R&D by 7% and 40.6% respectively, as compared to those in weak-FTR language environments.
It also found that this effect is weakened when the company has greater exposure to multilingual environments, such as operating in a more linguistically diverse and globalised country, and having more foreign institutional ownership.
Entitled Future-Time Framing: The Effect of Language on Corporate Future Orientation, the study was jointly conducted by assistant professor Hao Liang of Singapore Management University (SMU) Lee Kong Chian School of Business as the lead author, together with professor Christopher Marquis of Cornell University, professor Luc Renneboog of Tilburg University, and professor Sunny Li Sun of University of Massachusetts Lowell.
The paper was recently accepted by Organization Science and will soon be published.
Commenting on the findings, assistant professor Liang said, “We know that organisational behaviour and management practices vary significantly across countries, and these differences can be attributed to laws, regulations, cultures and social norms.
“However, what this research uncovers is a simple but deeper cognitive mechanism: the grammatical feature of the an organisation’s working language – whether it differentiates between future- and present-tense – is a strong predictor of the organisation’s future-orientation.”
He noted that for some languages, such as English, French and Spanish, grammatically separating the future and the present is mandatory, while for others, like German, Japanese and Mandarin, such is optional. “The obligatory FTR in a language reduces the psychological importance of – and hence concern for – the future, as it makes the future more distant,” he explained.