Does CEO power moderate the link between corporate social responsibility and bank earnings management
Journal of Global Responsibility
ISSN: 2041-2568
Article publication date: 7 December 2021
Issue publication date: 28 March 2022
Abstract
Purpose
This paper aims to investigate the relationship between corporate social responsibility (CSR) and earnings management (EM) in US commercial banks and examines whether the chief executive officer (CEO) power can moderate this relationship.
Design/methodology/approach
For a sample of American commercial banks covering 2009–2018, several equations and regressions are used to measure the main proxies for bank EM. The authors use the fixed effects model and generalized method of moment to investigate the CSR–EM relationship.
Findings
The authors find a significant positive relation between CSR and EM. Moreover, the authors find that CEO power moderates the CSR–EM relationship. This study also suggests a bidirectional relationship between CSR and EM.
Research limitations/implications
The findings of this paper have important policy implications for policymakers, regulators and investors in their attempts to constrain EM practices and enhance the quality of financial reporting in US commercial banks.
Originality/value
The study contributes to the literature by exploring the relationship between CSR practices and firm EM by particularly focusing on banking. This study offers new insights into whether the association between CSR practices and EM is moderated by the CEO power. To the best of the knowledge, the relationship between CSR and EM is not studied yet with the moderating role of CEO power.
Keywords
Acknowledgements
The authors would like to thank the Editor and the two anonymous referees of the “Journal of global responsibility” for their insightful comments that have greatly benefitted the paper. The author(s) received no financial support for the research, authorship, and/or publication of this article.
Citation
Miladi, E. and Chouaibi, J. (2022), "Does CEO power moderate the link between corporate social responsibility and bank earnings management", Journal of Global Responsibility, Vol. 13 No. 2, pp. 197-216. https://doi.org/10.1108/JGR-07-2021-0067
Publisher
:Emerald Publishing Limited
Copyright © 2021, Emerald Publishing Limited