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Gender diversity of boards and executives on real earnings management in the bull or bear period: Empirical evidence from China

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  • XiaoJiao Li
  • Ei Thuzar Than
  • Rizwan Ahmed
  • Maria Ishaque
  • Toan Luu Duc Huynh

Abstract

This study investigates whether gender diversity in the roles of executives, boards of supervisors and management impacts real earnings management during the bullish and bearish periods from 2000 to 2017. The sample is separated by bullish (11,616 firm‐year observations) and bearish (14,436 firm‐year observations) periods. The results suggest that female participation on supervisory boards and executives tend to kerb real earnings management during bearish and bullish periods. Another important finding is that female CEOs are more cautious in real earnings manipulation due to their risk‐averse nature during the bearish period, while female CFOs are more likely to constrain real earnings management in the bullish period. This study failed to find the relation of gender diversity on boards of management to real earnings management; however, the study has found that female executives (excluding CEOs and CFOs) who are also directors are more likely to limit earnings manipulation.

Suggested Citation

  • XiaoJiao Li & Ei Thuzar Than & Rizwan Ahmed & Maria Ishaque & Toan Luu Duc Huynh, 2023. "Gender diversity of boards and executives on real earnings management in the bull or bear period: Empirical evidence from China," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(3), pages 2753-2771, July.
    • Handle: RePEc:wly:ijfiec:v:28:y:2023:i:3:p:2753-2771
    DOI: 10.1002/ijfe.2562
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