Suchergebnisse

AbstractResearch question/issueThis study examines (i) whether and to what extent differences in the level of compensation paid to men and women can be observed at the corporate executive (i.e., CEOs) level in an international setting and (ii) whether and how country‐level attitudes toward gender equality help explain the heterogeneity in the CEO gender pay gap observed across countries.Research findings/insightsUsing executive compensation data from 27 countries over the 2001–2016 period, this study documents a 3.3% average difference in the level of executive compensation between male and female CEOs in countries around the world. The results further indicate that firms that transition from a male to a female CEO tend to have a significantly lower level of compensation. These results are robust when controlling for an array of key CEO attributes including education, age, and work experience and when US firms are excluded from the sample. Our findings also suggest that attitudes related to gender equality across countries can be an important factor explaining the CEO gender pay gap observed in our study.Theoretical/academic implicationsThe results of our study suggest the existence of a CEO gender pay gap at the international level. Specifically, our study suggests that the difference in pay between men and women, which is well documented in the literature of many countries, not only applies to regular employees in an economy but can also be generalized to those who work at the chief executive level. More importantly, our study suggests that a country's institutional environment vis‐à‐vis gender equality can contribute to the gender pay differences observed in various countries around the world.Practitioner/policy implicationsWe provide evidence supporting the existence of a gender pay gap using executive compensation data at the CEO level. We further show that country‐level institutional characteristics related to gender equality partly contribute to gender pay differences between male and female CEOs across countries. Thus, the findings of our study provide new insights into the potential determinants of executive compensation (i.e., CEO gender and country‐level gender equality) and are valuable to policymakers in proposing legislative changes to reduce the gender pay gap.

This paper examines whether CEO risk aversion – proxied by their political affiliation – explains the method used to manage earnings. We argue that, even though real earnings management can have severe long-term consequences for firm performance, Republican managers are likely to prefer real over accruals-based earnings management because the former incurs significantly lower litigation risk costs than the latter and is relatively more difficult to detect. Based on a sample of more than 20,000 firm-year observations, we find that firms led by Republican (i.e. more risk averse) CEOs tend to manage their earnings through real activities manipulation, while those led by Democratic (i.e. more risk taking) CEOs tend to favor accruals-based earnings management. We also show that the positive (negative) relation between Republican-leaning managers and real (accruals-based) is more positive (less negative) for CEOs whose compensation is more oriented towards risk-taking.

This paper examines whether CEO risk aversion – proxied by their political affiliation – explains the method used to manage earnings. We argue that, even though real earnings management can have severe long-term consequences for firm performance, Republican managers are likely to prefer real over accruals-based earnings management because the former incurs significantly lower litigation risk costs than the latter and is relatively more difficult to detect. Based on a sample of more than 20,000 firm-year observations, we find that firms led by Republican (i.e. more risk averse) CEOs tend to manage their earnings through real activities manipulation, while those led by Democratic (i.e. more risk taking) CEOs tend to favor accruals-based earnings management. We also show that the positive (negative) relation between Republican-leaning managers and real (accruals-based) is more positive (less negative) for CEOs whose compensation is more oriented towards risk-taking.

This paper examines whether CEO risk aversion – proxied by their political affiliation – explains the method used to manage earnings. We argue that, even though real earnings management can have severe long-term consequences for firm performance, Republican managers are likely to prefer real over accruals-based earnings management because the former incurs significantly lower litigation risk costs than the latter and is relatively more difficult to detect. Based on a sample of more than 20,000 firm-year observations, we find that firms led by Republican (i.e. more risk averse) CEOs tend to manage their earnings through real activities manipulation, while those led by Democratic (i.e. more risk taking) CEOs tend to favor accruals-based earnings management. We also show that the positive (negative) relation between Republican-leaning managers and real (accruals-based) is more positive (less negative) for CEOs whose compensation is more oriented towards risk-taking.

This paper examines whether CEO risk aversion – proxied by their political affiliation – explains the method used to manage earnings. We argue that, even though real earnings management can have severe long-term consequences for firm performance, Republican managers are likely to prefer real over accruals-based earnings management because the former incurs significantly lower litigation risk costs than the latter and is relatively more difficult to detect. Based on a sample of more than 20,000 firm-year observations, we find that firms led by Republican (i.e. more risk averse) CEOs tend to manage their earnings through real activities manipulation, while those led by Democratic (i.e. more risk taking) CEOs tend to favor accruals-based earnings management. We also show that the positive (negative) relation between Republican-leaning managers and real (accruals-based) is more positive (less negative) for CEOs whose compensation is more oriented towards risk-taking.