Directors network centrality and earnings quality

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review

3 Scopus Citations
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Detail(s)

Original languageEnglish
Pages (from-to)5381-5400
Journal / PublicationApplied Economics
Volume50
Issue number50
Online published26 Jun 2018
Publication statusPublished - 2018

Abstract

This study examines whether firms with network central boards of directors behave differently from other firms in terms of financial reporting quality. We find that earnings quality among firms is low when board networks are channels of incorrect information transmission (including earnings management information) and for firms whose directors are awarded equity-based compensation have connections through boardroom networks, but earnings quality is better for firms with good performance in spite of their networks. These results are robust to controlling for firm information environment, growth, size, age, leverage, performance, volatility in firm operations, and corporate governance.

Research Area(s)

  • director network centrality, discretionary accruals, Earnings quality, financial reporting quality

Citation Format(s)

Directors network centrality and earnings quality. / Godigbe, Bright Gershion; Chui, Chin Man; Liu, Chih-Liang.

In: Applied Economics, Vol. 50, No. 50, 2018, p. 5381-5400.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review