International Journal of Innovation and Applied Studies
ISSN: 2028-9324     CODEN: IJIABO     OCLC Number: 828807274     ZDB-ID: 2703985-7
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Do CEO characteristics affect earnings management? Evidence from France

Volume 12, Issue 4, September 2015, Pages 801–819

 Do CEO characteristics affect earnings management? Evidence from France

Zeineb Zouari1, Faten Lakhal2, and Mehdi Nekhili3

1 Faculty of Economics and Management of Sousse and Tunisia Polytechnic School, University of Sousse, Tunisia
2 IRG, University of Paris-Est and the ISG, University of Sousse, Tunisia
3 UFR Economic and Management Science, University of Reims Champagne Ardenne, France

Original language: English

Copyright © 2015 ISSR Journals. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.


This study attempts to add to the small body of existing literature relating Chief executive officer characteristics to earnings management. Our research was carried out on 153 French listed companies during 2008. Using discretionary accruals as a proxy for earnings management, we found a significant positive relationship between CEO characteristics and earnings management. This suggests that since reputed CEOs are well compensated, they are more afraid to lose thier compensation level, and their incentive to manipulate their firm's earnings therefore increases. Findings also indicate that the dual CEO-chair relationship encourages CEOs to manage earnings, particularly when CEO-chairs hold the major proportion of equity in the firm. This finding suggests that CEO-chairs use their managerial power and the freedom from control to extract private yields. Finally, we present new on the relationship between CEO expertise and earnings management, showing that expertise positively affects CEO's behavior leading to their using agressive earnings management.

Author Keywords: CEO reputation, duality, management ownership, CEO expertise, earnings management.

How to Cite this Article

Zeineb Zouari, Faten Lakhal, and Mehdi Nekhili, “Do CEO characteristics affect earnings management? Evidence from France,” International Journal of Innovation and Applied Studies, vol. 12, no. 4, pp. 801–819, September 2015.