Earnings management around founder CEO re-appointments and successions in family firms

Ansari, Iram Fatima, Goergen, Marc ORCID: https://orcid.org/0000-0003-4391-2651 and Mira, Svetlana ORCID: https://orcid.org/0000-0001-7321-4104 2021. Earnings management around founder CEO re-appointments and successions in family firms. European Financial Management 27 (5) , pp. 925-958. 10.1111/eufm.12307

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Abstract

This paper studies CEO re‐appointment and succession events in listed family firms with an incumbent family CEO. We explore whether family firms with a founder CEO are more likely to engage in earnings management pre‐event than other family firms. We find evidence of pre‐event upward earnings management for firms that re‐appoint their founder CEO but no for other family firms. These findings suggest that the costs and benefits from earnings management change around founder CEO re‐appointments in family firms. Investors, auditors, policy makers and regulators should be aware of the temptation of founder CEOs to inflate earnings preceding their re‐appointment.

Item Type:	Article
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics)
Additional Information:	This is an open access article under the terms of the Creative Commons Attribution License
Publisher:	Wiley:
ISSN:	1354-7798
Date of First Compliant Deposit:	3 March 2021
Date of Acceptance:	26 February 2021
Last Modified:	04 May 2023 23:54
URI:	https://orca.cardiff.ac.uk/id/eprint/139222

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