New Study Links Corporate Fraud, Earnings Performance To Glassdoor Reviews

With corporate fraud costing the offending stock’s shareholders 22% of the enterprise value, according to a 2014 academic study, how can investors identify stocks where fraud is a problem? Listen to employee’s anonymous ratings on the website Glassdoor, says a new study.

High job satisfaction leads to low corporate fraud instances

Glassdoor is a website that enables company employees to rate their employer, the work environment and the quality of executive management in an anonymous setting on a scale of 1 to 5.

Academics studied all entries from 2008 to 2015, including 1,112,476 employee ratings of 14,282 public firms. The employee satisfaction ratings were cross-referenced with Securities and Exchange Commission fraud...