scholarly journals Co-opted boards and earnings management: Evidence of reduced short-termist behavior

2021 ◽  
pp. 234094442098757
Author(s):  
Oneil Harris ◽  
Asligul Erkan
Keyword(s):  
Earnings Management ◽  
Chief Executive Officer ◽  
Chief Executive ◽  
Job Security ◽  
Jel Classification ◽  
Short Termism ◽  
Robust Evidence

This study contributes to the emerging literature on board co-option by examining how and to what extent co-opted directors influence managers’ attitudes about earnings management. We find robust evidence that co-option mitigates both real activities and accrual-based earnings management. Our findings support the view that higher co-option reduces managerial short-termism because it enhances managers’ job security as co-opted directors are known to be less likely to remove managers from office. Our results are robust to different measures of both co-option and earnings management, and they continue to hold after accounting for endogeneity and selection concerns. Finally, we provide additional evidence showing that a higher degree of co-option lowers the likelihood of the chief executive officer (CEO) being forcefully removed from the office for managing earnings in the previous year. JEL CLASSIFICATION G30; G34; G39

scholarly journals Praktik Manajemen Laba dan Reaksi Pasar Setelah Event Pergantian Chief Executive Officer (CEO)

2021 ◽  
Vol 31 (4) ◽  
Author(s):  
Desak Nyoman Sri Juliartini ◽  
Ida Bagus Putra Astika
Keyword(s):  
Earnings Management ◽  
Chief Executive Officer ◽  
Stock Price ◽  
Management Practices ◽  
Market Reaction ◽  
Sampling Technique ◽  
Chief Executive ◽  
Total Sample ◽  
Ceo Turnover ◽  
Analysis Technique

This research is to prove after the change of chief executive officer (CEO) of earnings management practices and market reaction. The total sample taken was using the nonprabability sampling method with a purposive sampling technique of 48 companies on the IDX which included the LQ45 index. The analysis technique used is simple linear regression and paired sample t-test on the DA and PER values of the company. Based on the results of the analysis found that there is no effect of earnings management on market reaction after one and two years of CEO turnover. These results prove that there is no important information on the announcement of CEO turnover, so it is less able to make significant stock price fluctuations. The next result is no difference in both earnings management and market reaction that occurs one and two years after CEO turnover. Keywords: Chief Executive Officer (CEO); Earning Management; Market Reaction; Price Earning Ratio (PER).

scholarly journals Institutional shareholding as a corporate governance mechanism that drives Chief Executive Officer pay

2020 ◽  
Vol 23 (3) ◽  
pp. 217-233
Author(s):  
María Consuelo Pucheta-Martínez ◽  
Carlos Chiva-Ortells
Keyword(s):  
Corporate Governance ◽  
Chief Executive Officer ◽  
Chief Executive ◽  
Jel Classification ◽  
Governance Mechanism ◽  
Pressure Sensitive ◽  
Variable Pay ◽  
Ceo Pay ◽  
Corporate Governance Mechanism ◽  
The Impact

We explore the effect of institutional directors on Chief Executive Officer (CEO) pay (total, fixed, and variable compensation). We delve particularly into the impact of pressure-sensitive and pressure-resistant institutional directors, who, respectively, represent institutional investors who maintain and investors who do not maintain a business relationship with the firm whose board they serve on. Focusing on CEO total pay, the findings show that institutional and pressure-resistant directors on boards behave similarly, affecting CEO total pay in a nonlinear way: as the presence of institutional and pressure-resistant directors on boards increases, the monitoring hypothesis prevails, and subsequently, better corporate governance decreases CEO total pay. However, when their presence on boards exceeds a critical point, the entrenchment hypothesis holds, thereby leading to an increase in CEO total pay. Contrary to our predictions, pressure-sensitive directors do not affect CEO total pay. Regarding the CEO’s compensation structure (fixed and variable), the results suggest that institutional and pressure-resistant directors increase fixed compensation and reduce variable pay, while pressure-sensitive directors affect neither fixed nor variable compensation. This evidence supports the view that institutional directors should be considered as a heterogeneous collective. JEL CLASSIFICATION: G3, G34, M12

scholarly journals Achieving useful data analytics for marketing: Discrepancies in information quality for producers and users of information

2021 ◽  
pp. 234094442199634
Author(s):  
Manuel Morales-Serazzi ◽  
Óscar González-Benito ◽  
Mercedes Martos-Partal
Keyword(s):  
Information Technology ◽  
Chief Executive Officer ◽  
Data Analytics ◽  
Information Quality ◽  
Methodological Approach ◽  
Chief Executive ◽  
Jel Classification ◽  
Marketing Plan ◽  
Determining Factor

This study proposes as a key cause of the high failure rates in the implementation of analytical projects for marketing decisions, the discrepancy in the information quality (DIQ) perceived between producers (information technology [IT]) and users (marketing) of knowledge. Given that the DIQ between agents is a determining factor in the success of the ability to data analytics, this study focuses on examining this concept and its causes, specifically the resources related to data analytics that influence DIQ. The results of the surveys carried out with the IT and marketing managers of 95 companies in Spain, analyzed with a comparative methodological approach (dyadic), reveal the sources of the discrepancy, namely, the quality of the data, the technological capabilities, the talent, Chief Executive Officer (CEO) support, and alignment of the data plan with the marketing plan. JEL CLASSIFICATION M31; M15; D82; L10

scholarly journals Female executive dan manajemen laba: Riset pada perusahaan manufaktur di Indonesia

2019 ◽  
Vol 1 (1) ◽  
pp. 18-27
Author(s):  
Anindya Setya Suciani ◽  
Hari Purnama
Keyword(s):  
Linear Regression ◽  
Earnings Management ◽  
Multiple Linear Regression ◽  
Chief Executive Officer ◽  
Stock Exchange ◽  
Chief Executive ◽  
Chief Financial Officer ◽  
Female Executives ◽  
Regression Test ◽  
Independent Variable

This study aims to test the effect of female executives on earnings management. The research was conducted at the manufacturing company listed on the Indonesia Stock Exchange in the 2015-2017 period. The purposive sampling was used 75 companies as data sample. Multiple linear regression test is used to see the effect of the independent variable on the dependent variable. The result of the analysis shows that the Female Chief Executive Officer (CEO), Female Chief Financial Officer (CFO) and Female Board of Commissioner does not influence earnings management. Whereas, the growth variable affects earnings management

scholarly journals PROFESIONAL FEE, PERGANTIAN CHIEF EXECUTIVE OFFICER (CEO), FINANCIAL DISTRESS DAN REAL EARNINGS MANAGEMENT

2020 ◽  
Vol 4 (2) ◽  
pp. 105 ◽  
Author(s):  
Bahtiar Effendi
Keyword(s):  
Earnings Management ◽  
Chief Executive Officer ◽  
Financial Distress ◽  
Chief Executive ◽  
Real Earnings Management ◽  
Purposive Sampling

Profesional Fee, Pergantian Chief Executive Officer (CEO), Financial Distress, dan Real Earnings Management. Tujuan dari penelitian ini adalah untuk menganalisis pengaruh profesional fee, pergantian CEO dan financial distress terhadap real earnings management pada perusahaan manufaktur yang tercatat di Bursa Efek Indonesia (BEI) selama periode tahun 2015-2017. Populasi dalam penelitian ini adalah seluruh perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia periode 2015-2017. Sampel penelitian ditentukan berdasarkan metode purposive sampling yang dipilih dengan beberapa kriteria tertentu. Jenis data yang digunakan dalam penelitian ini adalah data sekunder. Analisis data menggunakan analisis regresi linier berganda dengan menggunakan SPSS versi 26 sebagai alat analisis. Hasil penelitian menunjukkan bahwa profesional fee berpengaruh negatif dan tidak signifikan terhadap real earnings management; pergantian CEO berpengaruh positif dan tidak signifikan terhadap real earnings management; dan financial distress berpengaruh negatif signifikan terhadap real earnings management.

scholarly journals Financially Qualified Members in an Upper Echelon and Their Relationship with Corporate Sustainability: Evidence from an Emerging Economy

2018 ◽  
Vol 10 (12) ◽  
pp. 4697 ◽  
Author(s):  
Ashfaque Banbhan ◽  
Xinsheng Cheng ◽  
Nizam Ud Din
Keyword(s):  
Earnings Management ◽  
Agency Theory ◽  
Chief Executive Officer ◽  
Corporate Sustainability ◽  
Chief Executive ◽  
Top Management Teams ◽  
Audit Committees ◽  
Upper Echelon ◽  
Board Diversity

Non-observable board diversity is an important organizational strategy for improving the long-term growth and survivability of firms. The involvement of corporate sustainability (CS) in top management teams has led to effective boards. By using agency theory, we stress how financially qualified directors (FQD) in audit committees (ACs) may positively or negatively affect the practice of earnings management (EM). We also use various theories to explain how a powerful chief executive officer (CEO) complicates the effectiveness of AC and reduces their ability to detect EM practices. Using a sample of 1020 firm-year observations representing 204 non-financial listed Pakistani firms during 2013–2017, we find that the presence of FQD on the AC is associated with lower levels of EM. Our analysis shows that this effect is driven by the level of FQDs’ accounting knowledge.

scholarly journals Industry Expertise of Independent Directors and Board Monitoring

2015 ◽  
Vol 50 (5) ◽  
pp. 929-962 ◽  
Author(s):  
Cong Wang ◽  
Fei Xie ◽  
Min Zhu
Keyword(s):  
Earnings Management ◽  
Chief Executive Officer ◽  
Audit Committee ◽  
Chief Executive ◽  
Ceo Turnover ◽  
Independent Directors ◽  
Compensation Committee ◽  
Board Monitoring ◽  
Industry Experience ◽  
Industry Expertise

AbstractWe examine whether the industry expertise of independent directors affects board monitoring effectiveness. We find that the presence of independent directors with industry experience on a firm’s audit committee significantly curtails firms’ earnings management. In addition, a greater representation of independent directors with industry expertise on a firm’s compensation committee reduces chief executive officer (CEO) excess compensation, and a greater presence of such directors on the full board increases the CEO turnover-performance sensitivity and improves acquirer returns from diversifying acquisitions. Overall, the evidence is consistent with the hypothesis that having relevant industry expertise enhances independent directors’ ability to perform their monitoring function.

scholarly journals Do Companies with Female on the Board have Effects on the Earning Management? Evidence Indonesia Manufacturing Listed Firms

2021 ◽  
Vol 1 (1) ◽  
pp. 19-25
Author(s):  
Theresia Trisanti
Keyword(s):  
Earnings Management ◽  
Chief Executive Officer ◽  
Audit Committee ◽  
Management Practices ◽  
Management Practice ◽  
Chief Executive ◽  
Partial Least Square ◽  
Earning Management ◽  
Chief Financial Officer ◽  
Manufacturing Companies

This study aims to examine the influence of the presence of women on the board such as chief executive officer, chief financial officer and chief audit committee on the earning management (EM) practices and also to examine whether the educational backgrounds of women executive officials have a moderating effect on the earning management practice. The data used is secondary data from Indonesian listed manufacturing companies, hypothesis testing using regression model with partial least square test. Sampling was carried out using a purposive sampling method. The results showed that female chief executive officer and female chief financial officer did not affect earning management practice, but woman as chief audit committee affect the company's earnings management practices. Education background capable as moderating variable to strengthen the influence women as chief executive officer, chief financial officer and women as chief audit committee to earnings management practices. This research can provide contribution for users of financial statements about the possibility of differences in earnings management practices due to the presence of women in top management positions.

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