Monitoring female directors and earnings management, does corporate governance matter?

Alhossini, Mohammed A., Zalata, Alaa Mansour, Samaha, Sameeh Elmahdy and Hessian, Mohamed 2024. Monitoring female directors and earnings management, does corporate governance matter? Cogent Business & Management 11 (1) 10.1080/23311975.2024.2396538

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Abstract

In contrast to prior research on female directors’ participation, this study focuses on female directors playing a monitoring role within boardrooms. In addition, the current study investigates whether these female directors freeride from other strong governance mechanisms in place. Key Findings Based on a sample of US firms, we document that female directors fulfilling monitoring responsibilities play a crucial role in protecting shareholders’ interests in both weak and strong corporate governance settings. In addition, interestingly, our results suggest that female directors, particularly monitoring female directors, significantly mitigate earnings management in firms audited by Big-4 and non-Big-4 auditors although their impact seems to be more prominent within non-Big-4 audit firms. That is, it seems that these directors are more likely to scrutinize managers closely when they feel that shareholders are at risk of being subjected to deception due to opportunistic practices by managers (i.e. when managers deliberately choose relatively low-quality auditors to audit corporate financial reports).

Item Type:	Article
Date Type:	Published Online
Status:	Published
Schools:	Schools > Business (Including Economics)
Publisher:	Taylor and Francis Group
ISSN:	2331-1975
Date of First Compliant Deposit:	15 August 2025
Date of Acceptance:	16 August 2024
Last Modified:	15 Aug 2025 12:00
URI:	https://orca.cardiff.ac.uk/id/eprint/180445

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