Board gender diversity, corporate governance, and earnings management

2019 ◽  
Vol 35 (1) ◽  
pp. 37-60 ◽  
Author(s):  
Nurlan Orazalin
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Management Practices ◽  
Gender Diversity ◽  
Policy Implications ◽  
Annual Reports ◽  
Public Companies ◽  
Content Type ◽  
Weak Evidence ◽  
Board Gender Diversity

Purpose The purpose of this study is to examine whether board gender diversity and other board characteristics affect earnings management practices of top public companies in Kazakhstan. Design/methodology/approach The study analyzes data of top public companies for the period 2010-2016. Data on corporate governance were manually collected from annual reports and investment memorandums, and financial data were collected from audited financial statements. Findings The empirical results show that companies with greater board gender diversity are more effective in constraining earnings management. The findings also indicate that companies with larger boards adopt a more restrained approach to earnings management practices, thus supporting the theoretical framework of the study. However, the results provide weak evidence of the association between board independence and earnings quality. Originality/value This study is the first to investigate the relationship between gender diversity and earnings management in emerging markets such as Kazakhstan that offers managerial and policy implications.

Corporate governance compliance and accrual earnings management in eastern Africa

2018 ◽  
Vol 33 (2) ◽  
pp. 171-191 ◽  
Author(s):  
Nelson M. Waweru ◽  
Ntui Ponsian Prot
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Capital Markets ◽  
Audit Quality ◽  
Stock Exchange ◽  
Gender Diversity ◽  
Eastern Africa ◽  
Annual Reports ◽  
Content Type ◽  
Board Gender Diversity

Purpose The purpose of this paper is to examine whether compliance with corporate governance (CG) requirements has constrained earnings management (EM) for companies listed in Kenya and Tanzania. Design/methodology/approach The sample comprises of 48 companies listed on the Nairobi Stock Exchange and the Dar es Salaam Stock Exchange. The data are collected from annual reports over the period 2005-2014, a total of 480 firm-year observations. Panel data models are used in the analyses. Findings The results show that discretionary accruals (DAs) average about 11.3 per cent, whereas audit quality is negatively and significantly related to DAs. However, board independence, board gender diversity and director share ownership were positively and significantly related to DAs suggesting that CG may not have constrained EM in eastern Africa. Research limitations/implications The findings should be understood within the context that only annual reports and audited financial statements that were filed with Capital Markets Authority (Kenya) and Capital Markets and Securities Authority (Tanzania) are used as source of information. Originality/value The study potentially contributes in three main ways. First, this is the first cross-country analysis that has examined the effect of CG structures on EM in an African context. Second, literature on CG and EM has been extended. Finally, the authors have extended research by observing the limitations of CG in reducing EM in an environment that is experiencing weaknesses in CG structures.

Gender diverse board and earnings management: evidence from French listed companies

2018 ◽  
Vol 9 (3) ◽  
pp. 289-312 ◽  
Author(s):  
Sana Triki Damak
Keyword(s):  
Earnings Management ◽  
Boards Of Directors ◽  
Management Practices ◽  
Gender Diversity ◽  
Generalized Least Squares ◽  
Content Type ◽  
Management Level ◽  
Women On Boards ◽  
The Government ◽  
Board Gender Diversity

Purpose The purpose of this paper is to investigate the influence of board gender diversity on earnings management level and strategy. Design/methodology/approach This study is conducted in the French context where firms are pressured since 2010 to appoint more women on boards. More specifically, this research is based on a sample of 85 companies listed in the SBF120 over 2010-2014. A number of econometric techniques are used including generalized least squares to test the panel regressions. Findings The results suggest that women on boards are effective in their monitoring role. Indeed, the findings show a significant negative effect of board women presence on earnings management practices level. However, there is no empirical evidence that board gender diversity affects the earnings management strategy. Moreover, the results reveal that some control variables influence significantly the earnings management level and strategy. Practical implications The findings support the efforts made by French political bodies to increase gender diversity on corporate boards, and might inspire political actors of other countries to take initiatives to regulate the promotion of women’s appointment on boards of directors. Social implications This paper contributes to the issue of discrimination against women in law and in practice. Indeed, the findings highlight the beneficial effects of women participation in power and decision-making positions. Originality/value This research contributes to the debate around gender diversity on boards. Most prior studies that have analyzed the relationship between gender diversity and earnings management were conducted in a voluntary context of appointing women on boards. This paper extends prior research by addressing this issue differently and in a regulated context: where the government set mandatory quotas for female board representation.

Does board gender diversity affect the transparency of corporate political disclosure?

2018 ◽  
Vol 26 (4) ◽  
pp. 444-463 ◽  
Author(s):  
D.G. DeBoskey ◽  
Yan Luo ◽  
Jeff Wang
Keyword(s):  
Corporate Governance ◽  
Voluntary Disclosure ◽  
Gender Diversity ◽  
Political Activity ◽  
Political Contributions ◽  
Firm Level ◽  
Data Set ◽  
Content Type ◽  
Ethics Research ◽  
Board Gender Diversity

Purpose The purpose of this paper is to examine the influence of board gender diversity on the transparency of corporate political disclosure (CPD). Design/methodology/approach Two empirical proxies, CPD transparency and policy transparency, are constructed from a data set jointly produced by the Center of Political Activity and the Carol and Lawrence Zicklin Center for Business Ethics Research. The CPD transparency score measures the level of transparency in voluntary corporate disclosure of the amount of political contributions and the identity of the recipients as well as the titles and names of the executives who authorize the political spending. The policy transparency score measures the level of transparency in the voluntary disclosure of the policies governing corporate political spending. Board gender diversity is measured by the percentage of women on the board of directors. Findings Higher proportions of female directors are associated with more transparent disclosure of political contributions after controlling for a set of corporate governance and firm-level variables. Originality/value This study is the first to examine whether and how gender-diversified boards enhance the transparency of CPD. It contributes to the literature by providing evidence that gender-diversified boards enhance corporate governance.

scholarly journals Political and financial background in board interlocking and earnings management in Brazil

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Cristian Baú Dal Magro ◽  
Roberto Carlos Klann
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Financial Reporting ◽  
Management Practices ◽  
Accounting Information ◽  
Real Earnings Management ◽  
The Political ◽  
Content Type ◽  
Quality Of Accounting Information

Purpose Although board interlocking underlying forces are largely hidden, the purpose of this paper is to provide managers, auditors, analysts, regulators and other stakeholders with sociological board interlocking information considering the different backgrounds of their members. Design/methodology/approach The research sample gathered 1,606 observations from 2010 to 2017. For data analysis, the direct and indirect board interlocking linkages, considering the different backgrounds of board members, established the centrality indicators. Subsequently, the authors used these indicators according to each measured background in the regression models. Findings The results indicate that the political background of board interlocking members is positively related to real earnings management practices, while the financial background has a mitigating effect on such practices. Research limitations/implications The findings suggest that individual skills and interests conveyed across the corporate social network have shaped corporate governance, with distinct impacts on the quality of accounting information. Practical implications The authors conclude that both backgrounds could have implications on agency conflicts, increasing (policy) or reducing (financial) information asymmetry between the company and its various stakeholders, which indicates that the authors must consider sociological and not just economic aspects within corporate governance. Social implications The sociological background of individuals is necessary for the congruence of monitoring mechanisms, and consequently, the quality of accounting information. Originality/value This study examines the influence of the political and financial background of board interlocking members on real earnings management practices in Brazilian publicly traded companies in the International Financial Reporting Standards post-adoption period.

The role of national culture in the impact of board gender diversity on firm performance: evidence from a multi-country study

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Navaz Naghavi ◽  
Saeed Pahlevan Sharif ◽  
Hafezali Bin Iqbal Hussain
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Generalized Method Of Moments ◽  
Gender Diversity ◽  
Governance Structure ◽  
Corporate Governance Structure ◽  
Data Set ◽  
Content Type ◽  
Board Gender Diversity ◽  
The Impact

PurposeThis study seeks to add more insights to the debate on “whether”, “how”, and “under which condition” women representation on the board contributes to firm performance. More specifically, the current study aims to investigate if the effect of board gender diversity on firm performance is dependent on macro factors of national cultures.Design/methodology/approachThe authors used the generalized method of moments regression and a data set consists of 2,550 company year observations over 10 years.FindingsThe results indicated that cultural variables interact with board diversity to influence firm performance. Having women on the board in countries with high power distance, individualist, masculine and low-uncertainty avoidance culture influences the firm performance negatively.Originality/valueThe findings indicate that the effects of corporate governance structure on firm performance depends on culture-specific factors, providing support for the argument that institutional norms that are governed by cultural norms affect the effectiveness of corporate governance structure.

scholarly journals Board gender diversity and environmental, social and governance performance of US banks: moderating role of environmental, social and corporate governance controversies

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohammad Hassan Shakil ◽  
Mashiyat Tasnia ◽  
Md Imtiaz Mostafiz
Keyword(s):  
Corporate Governance ◽  
Fixed Effects ◽  
Resource Dependence ◽  
Gender Diversity ◽  
Corporate Boards ◽  
Omitted Variables ◽  
Content Type ◽  
Dynamic Panel Regression ◽  
Board Gender Diversity

PurposeGender diversity in corporate boards is broadly studied in existing corporate governance literature. However, the role of board gender diversity on environmental, social and governance (ESG) performance of the banks is still unaccounted for. Drawing on resource dependence and legitimacy theory, this study addresses this pressing research issue. Moreover, investigation of ESG controversies as a moderator paves the existing corporate governance research to the new avenues.Design/methodology/approachData were sourced from Refinitiv database on 37 US banks from the period of 2013 to 2017. This study employs static and dynamic panel regression models that include random effects, fixed effects and dynamic generalised method of moments (GMMs) to test the hypotheses. Furthermore, system GMM is used to reduce the issue of endogeneity, measurement error, omitted variables bias and bank-specific heterogeneity.FindingsWe identify a significant positive relationship between board gender diversity and the ESG performance of US banks. However, the result propounds non-significant moderating effect of ESG controversies on the board gender diversity–ESG performance nexus.Originality/valueLiterature on board gender diversity and ESG separately and predominantly explains firm/bank's financial performance. This study is one of the pioneering attempts to explain the role of board gender diversity on ESG performance. Although incremental, however, this study also contributes to the literature on ESG in the US context.

scholarly journals Corporate governance and dividend pay-out policy in UK listed SMEs

2017 ◽  
Vol 25 (4) ◽  
pp. 459-483 ◽  
Author(s):  
Mohamed H. Elmagrhi ◽  
Collins G. Ntim ◽  
Richard M. Crossley ◽  
John K. Malagila ◽  
Samuel Fosu ◽  
...  
Keyword(s):  
Corporate Governance ◽  
Fixed Effects ◽  
Audit Committee ◽  
Gender Diversity ◽  
Negative Relationship ◽  
Corporate Board ◽  
Board Size ◽  
Content Type ◽  
Board Gender Diversity ◽  
Alternative Investment

Purpose The purpose of this paper is to examine the extent to which corporate board characteristics influence the level of dividend pay-out ratio using a sample of UK small- and medium-sized enterprises from 2010 to 2013 listed on the Alternative Investment Market. Design/methodology/approach The data are analysed by employing multivariate regression techniques, including estimating fixed effects, lagged effects and two-stage least squares regressions. Findings The results show that board size, the frequency of board meetings, board gender diversity and audit committee size have a significant relationship with the level of dividend pay-out. Audit committee size and board size have a positive association with the level of dividend pay-out, whilst the frequency of board meetings and board gender diversity have a significant negative relationship with the level of dividend pay-out. By contrast, the findings suggest that board independence and CEO role duality do not have any significant effect on the level of dividend pay-out. Originality/value This is one of the first attempts at examining the relationship between corporate governance and dividend policy in the UK’s Alternative Investment Market, with the analysis distinctively informed by agency theoretical insights drawn from the outcome and substitution hypotheses.

scholarly journals Corporate Governance and the Earnings Quality of Nigerian Firms

2020 ◽  
Vol 11 (5) ◽  
pp. 161
Author(s):  
Festus Oladipupo Olaoye ◽  
Ademola Adeniran Adewumi
Keyword(s):  
Corporate Governance ◽  
Comprehensive Evaluation ◽  
Earnings Quality ◽  
Gender Diversity ◽  
Annual Reports ◽  
Board Independence ◽  
Manufacturing Companies ◽  
Board Size ◽  
Board Gender Diversity ◽  
The Impact

The focus of the study is to examine the impact of corporate governance on earnings quality in listed firms in Nigeria. The specific objective is to investigate the effect of board size, board independence and board gender diversity on earnings quality. This study was carried out with secondary data retrieved from corporate annual reports of the sampled companies and the data was analysed using panel regression on a sample of 37 quoted manufacturing companies for the period 2011-2017. On the overall, the result reveals that Board size, board independence and board gender diversity used for measuring corporate governance show significant impact on earnings quality. In addition, corporate governance variables appear to be quite sensitive to the measure of earnings quality used. Based on the findings, the study recommends the need for comprehensive evaluation of corporate governance systems of companies. The study recommends the need for more level of board independence. The diversity issue though is gaining momentum in corporate governance literature can still be regarded as not as dominant as compared to others especially as it relates to protecting shareholder rights and framing dividend policy. The significance of the variable nevertheless suggests that companies should thrive to achieve an appropriate diversity mix.

scholarly journals Board characteristics and earnings management in Sri Lanka

2019 ◽  
Vol 27 (1) ◽  
pp. 2-18
Author(s):  
Shanmugavel Rajeevan ◽  
Roshan Ajward
Keyword(s):  
Corporate Governance ◽  
Sri Lanka ◽  
Earnings Management ◽  
Management Practices ◽  
Stock Exchange ◽  
Governance Structure ◽  
Real Earnings Management ◽  
Content Type ◽  
Board Characteristics ◽  
Market Capitalisation

Purpose The purpose of this paper is to examine the association between designated corporate governance attributes and the degree of earnings management in selected quoted companies in Sri Lanka. Design/methodology/approach In total, 70 listed companies in Colombo Stock Exchange (CSE) were selected based on the highest market capitalisation for the period covering from 2015 to 2017 and representing beverage, food and tobacco, diversified, hotel and travel, manufacturing, oil palms and health care sectors, which accounted for 59.9 per cent of the total market capitalisation of CSE. Findings This study found a positive relationship between CEO-Chair duality and earnings management. Practical implications The insights may also provide investors, economic analysts and regulators with early caution indicators of potential problems in a corporation regarding corporate governance failures and aid stakeholders in assessing the effectiveness and efficiency of the board and corporate governance structure and earnings management methods. Originality/value This study extends the extant research on board characteristics and real earnings management by adopting prominent research design and modernised data. This study offers evidence on how selected audit and board committee’s characteristics influence real earnings management practices.

scholarly journals Determinants of Intelligent Energy Implementation Towards Firm Performance: A Conceptual Framework Moderated by Board Gender Diversity and Board Sustainability Committee

2021 ◽  
Vol 9 (1) ◽  
pp. 59
Author(s):  
Dayana Mastura Baharudin ◽  
Maran Marimuthu
Keyword(s):  
Corporate Governance ◽  
Boards Of Directors ◽  
Oil And Gas ◽  
Gender Diversity ◽  
Oil And Gas Industry ◽  
Listed Companies ◽  
Annual Reports ◽  
Board Gender Diversity ◽  
Code Of Corporate Governance ◽  
The Impact

This study examines the impact of Intelligent Energy assessed by seven criteria to be followed by Malaysia’s listed companies (PLCs), regulated by Bursa Malaysia which are regulated by the Malaysian Corporate Governance Code 2017 (MCCG 2017)—30 percent Women Boards of Directors as well as by the existence of the Board Sustainability Committee which have not been endorsed by the MCCG 2017. In order to explore the reporting of the seven criteria of intelligent energy amongst Malaysian oil and gas public listed companies, in terms of gender-based and sustainability-based, it follows the methodology of descriptive statistics, regression analysis and content analysis derived from previous studies and the analysis of annual reports and integrated reports. This research provides a thorough analysis of present study breakthroughs in the worldwide oil and gas industry’s Integrated Operations. The 30 percent moderation factor Female Board members, as per the Malaysian Code of Corporate Governance 2017 (MCCG, 2017), would be assessed to see whether having an increased representation of women would encourage the implementation of the seven criteria of Intelligent Energy, as well as the moderation factor of the Board Sustainability Committee, which has not yet been made recommended practice by MCCG 2017, would be a driving force towards intelligent energy within the Malaysian oil and gas industry. Other than the Malaysian oil and gas sector, the Intelligent Energy scoring index might be used to other oil and gas PLCs in the ASEAN area, such as Vietnam and Myanmar, which have growing oil and gas resources.

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