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Board Diversity and Accounting Conservatism: Evidence from Jordan

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  • Mohammed Hassan Makhlouf
  • Fares Jamiel Al-Sufy
  • Haitham Almubaideen

Abstract

The main aim of this research is to investigate whether board diversity affect the accounting conservatism. This study depends on a panel data set drawn from 68 industrial firms listed on Amman Stock Exchange (ASE) for the period from 2013 to 2016. Four demographic characteristics of directors have been investigated, namely: gender diversity, education level, average age and nationality diversity. Accounting conservatism was measured by accrual-based conservatism. The results indicate that gender diversity, education level and nationality diversity are significantly positively correlated with accounting conservatism. However, the findings fail to reveal any significant effect for directors' age on accounting conservatism. The findings of this study assert that it is necessary to take board diversity (directors' demographic characteristics) into account when choosing board of directors members because demographic characteristics diversity influences directors' behavior to deal with different issues that are related to accounting principles.

Suggested Citation

  • Mohammed Hassan Makhlouf & Fares Jamiel Al-Sufy & Haitham Almubaideen, 2018. "Board Diversity and Accounting Conservatism: Evidence from Jordan," International Business Research, Canadian Center of Science and Education, vol. 11(7), pages 130-141, July.
    • Handle: RePEc:ibn:ibrjnl:v:11:y:2018:i:7:p:130-141
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    References listed on IDEAS

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    Cited by:

    1. Fares Jamiel Hussein Alsufy, 2019. "The Impact of Audit Committees Controls Commitment on Strengthening Corporate Governance: Evidence from Jordan," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 11(3), pages 69-76, March.
    2. Mohammed Hassan Makhlouf & Fares Jamiel Al-Sufy, 2018. "Ownership Concentration and Going Concern: Evidence from Jordanian Listed Firms," International Journal of Business and Management, Canadian Center of Science and Education, vol. 13(9), pages 139-139, August.
    3. Siti Fadilah Bt Mat Zin & Marziana Madah Marzuki & Nik Kamaruzaman Hj. Abdulatiff, 2020. "The Likelihood of Fraudulent Financial Reporting: The New Implementation of Malaysian Code of Corporate Governance (MCCG) 2017," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(3), pages 84-91, June.
    4. Festus Oladipupo Olaoye & Ademola Adeniran Adewumi, 2020. "Corporate Governance and the Earnings Quality of Nigerian Firms," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(5), pages 161-171, October.

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    More about this item

    Keywords

    board diversity; female; education level; age; nationality diversity; accounting conservatism; Jordan;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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