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The purpose of this study is to examine the impact of managerial ability on corporate tax risk and long-term tax avoidance using the upper echelons theory.

This study uses a quantitative method with regression models, using a sample of listed firms on the Indonesia Stock Exchange from 2011 to 2018.

The regression results report that managerial ability negatively influences tax risk and positively impacts long-run tax avoidance. Companies with more able managers have a relatively lower tax risk and greater long-run tax avoidance. The results reveal that firms with managers that possess greater abilities are more committed to long-run tax avoidance while concurrently maintaining a lower level of their tax risk. The impacts the authors report are statistically significant and robust, as proved by a series of robustness checks and additional tests.

This study only includes firms from one developing country.

The empirical results might be of interest to board members while envisaging the benefits and costs of appointing and hiring managers, as well as to the tax authority and the other stakeholders interested in apprehending how managerial ability influences corporate tax risk and long-run tax avoidance practices simultaneously.

This study proposes and tests an explanation for the impact of managerial ability on corporate tax risk and long-run avoidance simultaneously in the context of an emerging country.

The purpose of this paper is to review and summarize research into managerial incentives, merger activity, performance, and the use and structure of compensation to mitigate agency problems in the firm.

The authors discuss studies of size elasticity and compensation, pay for performance, changes in managerial compensation due to merger activities, incentives and risk taking, and the relationship between managerial risk aversion and acquisitions.

The paper identifies several prominent themes in the literature. First, size and performance both appear to be positively related to managerial compensation. There appears to be a strong relation between pay and performance, but results depend upon whether the pay measure includes all forms of compensation. With mergers, any merger gains seem to accrue to the acquired firm. It appears that acquiring managers can increase their pay by merging with other firms, and this is likely to happen in cases where shareholder returns are negative. Regarding managerial risk taking and compensation, it is likely that the sensitivity of a manager's equity‐based compensation (options, in particular) to changes in the total risk of the firm is an indicator of how willing managers will be to seek out more risk on behalf of shareholders.

This paper synthesizes a large body of research into an organized discussion of the issues relating to merger activity, managerial incentives, compensation, and pay for performance issues.

This research aims to examine the moderating role of managerial ability on the relationship between risk-taking behavior and firms' performance.

This research uses 383 manufacturing firm-years listed on the Indonesian Stock Exchange as the research sample. The hypothesis test uses fixed-effect regression analysis.

The result shows that risk-taking behavior has a positive effect on firms' performance for higher managerial ability. Managerial ability provides higher knowledge, skill and information to get benefits and mitigate costs of risk-taking behavior to improve firms' performance. The role of managerial ability to make risk-taking behavior increase firms' performance occurs more for high-ability managers, dual CEO, shareholder-CEO and family CEO.

This research contributes to answering the conflicting arguments and filling the previous findings gap between risk-taking behavior and firm performance by considering managerial ability as a factor to create effective risk mitigation.

The purpose of this paper is to investigate the influence of idiosyncratic risk on firm decisions.

By introducing managerial ownership as a key variable, the paper presents a parsimonious model to describe the consequences of idiosyncratic risk on firm decisions. Then the paper uses data from the Chinese stock market, in which the managerial ownership is very low (around 0.02 percent) to examine the model predictions.

The authors find that: first, the negative relation between idiosyncratic risk and firm investment, which is found in prior studies, tends to be insignificant when managerial ownership is very low; second, diversification, as an alternative firm decision to lower risk positively, relates to idiosyncratic risk despite lower managerial ownership; and third, this kind of positive relation is weaker for firms with more managerial incentives when diversification is endogenously modeled.

This paper provides new evidence to complement existing studies from developed markets, in which executives hold substantial stakes.

This study aims to empirically explore the influence of managerial ability on crash risk and the moderating effect of financial constraints on this interrelationship.

Using a sample of listed corporations in the Egyptian Stock Exchange during 2018–2021, the authors test the hypotheses by using the measures and methods well established in prior literature. The authors also conduct multiple robustness analyses to ensure the validity of the empirical results.

The findings suggest that managerial ability can effectively inhibit crash risk. In addition, the authors report that financial constraints significantly dampen this relationship. Thus, financial restrictions play a striking role in hampering the managerial ability to prevent stock crashes. Furthermore, the authors document that the moderating role of severe financing constraints is more prominent during the Covid-19 pandemic period.

The originality of this study stems from the following considerations. First, this study enriches relevant studies on crash risk by providing evidence from one of the emerging markets in the Middle East; thereby, contrasting with those in developed economies. Second, to the best of the authors’ knowledge, this is the first study investigating the moderating impact of financing constraints on the managerial ability and crash risk nexus. Therefore, this work adds value to the extant knowledge by scrutinizing this important issue and providing novel empirical evidence.

The existing literature, generally based on US data, provides little evidence that supports whether managerial ability directly links to corporate risk-taking. Hence, this study aims to expand the limited extent by investigating the impact of managerial ability on risk-taking across Saudi firms.

This study mainly uses a panel fixed-effects model, including firm-year and firm-industry, to analyse a sample of Saudi non-financial firms from the period 2008 – 2018. In the empirical analysis, the managerial ability is lagged by one year to mitigate endogeneity concerns that may arise from reverse causality. To avoid omitted variables bias, this study includes several firm-level control variables.

The empirical results show that the relationships between managerial ability and firm risk-taking measures are negative and statistically significant with the standard deviation of return on assets (sROA) and leverage; positive and statistically significant with the Z-score. These results indicate that firms managed by high-ability executives have the propensities to take less risk. The main results remain robust to additional sensitivity analyses including an alternative measure for managerial ability, an alternative proxy for risk-taking using logistic regression analysis, using financial crises as dummy variables, and using a cross-lagged panel model with fixed effects for endogeneity concerns.

When evaluating firms, all market and society participants including researchers, regulators, supervisors, policymakers, and boards ought to pay close attention to managerial ability as one of the main factors affecting risk-taking.

Previously, closely related studies, focussing on the US market, mainly find that managers with high ability are receptive to risk-taking. This paper offers further international insight into the relevant literature by providing evidence that capable managers are inclined to take low risks.

The purpose of this paper is to establish the relationship between managerial competence, managerial risk-taking behaviour and financial service outreach of microfinance institutions (MFIs).

In this cross-sectional and correlational study, the authors surveyed 52 branches of MFIs from a population of 60 branches of 20 MFIs in eastern Uganda. Two respondents, a branch manager and a senior loan officer, were the units of enquiry for each branch. The authors put forward and tested four hypotheses relating to the significance of the relationship between perceived managerial competence, risk-taking behaviour and financial service outreach using SPSS version 20. The authors established the hypothesized relationships using Pearson correlation coefficients and obtain a mediating effect of risk-taking behaviour using partial corrections and regression analysis.

The results suggest positive and significant relationships between perceived managerial competence, risk-taking behaviour and financial service outreach. However, while the direct relationship between managerial competence and financial service outreach without the mediation effect of risk-taking behaviour of managers was found to be significant, its magnitude reduces when mediation of risk-taking behaviour is allowed. Thus the entire effect does not only go through managerial competence but majorly also, through risk-taking behaviour of managers.

This study did not control for environmental factors such as laws and regulations. As such the model may have been under fitted. Nevertheless, the study has introduced a clearer understanding that outreach performance in MFIs rests with competent managers in strategic positions operating in synergy with their risk-taking behaviour. The study informs policy makers that outreach performance of the MFIs depends on the quality of the competence managers have in addition to their risk-taking propensities.

Efforts by the stakeholders to improve financial service outreach must be matched with appropriate competences and risk-taking behaviour of managers.

The results contribute to extant literature by investigating two explanatory variables for financial service outreach and provide initial evidence of the mediating effect of intrinsic high risk-taking behaviour of managers. Results add to the conceptual improvement in risk-taking behaviour and lend considerable support for the behavioural perspective in the study of financial service outreach of MFIs.

The main objective of the paper is to examine the relationship between managerial attributes (e.g. managerial entrenchment, managerial myopia and managerial overconfidence) and firm risk-taking on the Tehran Stock Exchange (TSE).

The study’s sample comprises 150 companies listed on the TSE from 2011 to 2017. Risk-taking is calculated as the standard deviation (SD) of stock return. Explanatory factor analysis was performed to calculate the weight of each of the five variables managerial ownership, board independence, chief executive officer (CEO) tenure, board compensation and CEO duality as a proxy for managerial entrenchment. The study by Anderson and Hsiao (1982) was also used to calculate managerial myopia, and the study by Schrand and Zechman (2012) was used to calculate managerial overconfidence.

The results indicate that the effect of managerial entrenchment and managerial myopia on risk-taking of listed firms on the TSE is positive and significant, implying that an increase in CEO entrenchment is likely to give rise to risk-taking. The authors conjecture that this finding could be due to the investment projects impairing the firm performance in the long run. Furthermore, the effect of managerial overconfidence on listed firms' risk-taking on the TSE is significantly negative. Since overconfidence is one of the traits of narcissism and corporate managers tend to be encouraged and admired, it is implied that they tend to make efficient and low-risk investments that ultimately reduce the firm risk-taking.

Several theoretical studies show that managerial behavior is a determining factor in the economy. One of the reasons which justify the originality of this study is the context and institutional environment. Undoubtedly, managerial behavior (e.g. managerial entrenchment, managerial myopia and managerial overconfidence) is expected to have some significant variations in developing countries compared to prevailing in developed countries, particularly in the Iranian stock market the economic sanctions. Furthermore, due to the direct impact of individuals' psychological and behavioral characteristics on their decisions and the effect of companies' risk-taking on increasing and decreasing shareholders and companies' wealth, this research is essential. Given the function of designed behavioral criteria for assessing risk-taking behaviors, the relationship between managerial attributes and firms' risk-taking is still unclear and investigated in this study.

This study aims to advance a behavioural approach towards understanding how managerial perception impacts the enactment of responses to risk management during the implementation of digital technologies in industrial operations and supply chains. The purpose is to investigate the influence of (digital) technology and task uncertainty on the risk perception of managers and how this impacts risk responses adopted by managers.

Following an exploratory theory elaboration approach, the authors collected more than 80 h of interview material from 53 expert interviews. These interviews were conducted with representatives of 46 German companies that have adopted digital technologies for different industrial applications within manufacturing, assembly and logistics processes.

The findings provide nuanced insights on how individual and combined sources of uncertainty (technology and task uncertainty) impact the perception of decision makers and the resulting managerial responses adopted. The authors uncover the important role played by the interaction between digital technology and human being in the context of industrial operations. The exploratory study shows that the joint collaboration between humans and technologies has negative implications for managerial risk responses regardless of positive or negative perception, and therefore, requires significant attention in future studies.

The empirical base for this study is limited to German companies (mainly small and medium size). Moreover, German culture can be characterised by a high uncertainty avoidance and this may also limit the generalizability of the findings.

Managers should critically revise their perception of different types of digital technologies and be aware of the impact of human-machine interaction. Thereby, they should investigate more systematic approaches of risk identification and assessment.

This paper focuses on the managerial risk responses in the context of digitalisation projects with practical insights of 53 expert interviews.

This study examines the impact of managerial ownership on risk‐taking and firm performance. The study utilizes data for thirty randomly selected companies from four industries in four different sectors. Industries are oil & gas and field services from energy sector; insurance, property, and casualty from the financial sector, drugs from the health sector; and computer and data processing from the technology sector. This yielded a total of 120 observations. Accounting measures and correlation analysis are used to determine the relationship between managerial ownership, risk‐taking, and firm performance in each industry and for the whole sample. We found no significant relationship between these variables in different industries and for the whole sample. Managerial ownership seems to be merely a reflection of the way in which managers receive their benefits. Managerial ownership does not seem to provide any incentive to work harder for improving the company’s performance in the accounting sense.