CHARACTERISTICS OF BRAZILIAN CEOS AND RESULTS MANAGEMENT

Authors

DOI:

https://doi.org/10.51320/rmc.v25i3.1611

Keywords:

CEO Characteristics, Chief Executive Officer, Quality of Accounting Information, CEO Profile, Upper Echelons Theory

Abstract

The objective of this study was to investigate the relationship between the specific characteristics and skills of Brazilian CEOs and Earnings Management, covering the period from 2016 to 2019 and focusing on non-financial companies listed on B3. A sample of 194 companies was used, and a multiple regression analysis with unbalanced panel data was conducted. Earnings management was measured using Pae’s model (2005). The descriptive analysis of the variables shows that the average age of CEOs is 53.63 years, with an average tenure of approximately two years, and CEOs who simultaneously hold the position of CEO and chairperson represent 44.90% of the sample. The average remuneration of Brazilian CEOs was R$ 3,248,286.00. Regarding the econometric results, significant findings were identified for three variables: duality, age, and participation in Board of Directors meetings, supporting hypotheses H2, H3, and H7. However, the variables of remuneration, gender, educational background, tenure, and family-related CEOs did not show statistical significance. This study contributes to expanding the understanding of how the specific characteristics and skills of managers can impact corporate outcomes. The findings offer potential benefits for organizations by encouraging reflection on the alignment between the profiles of hired CEOs and business strategies, as well as for financial analysts, who may use these results to enhance their understanding of accounting information. Additionally, it provides theoretical contributions to the emerging literature on this topic within the national context.

Downloads

Download data is not yet available.

Author Biographies

Annandy Raquel Pereira da Silva, Universidade Federal de Santa Catarina (UFSC)

Doutoranda em Contabilidade pela Universidade Federal de Santa Catarina - UFSC. Mestra em Ciências Contábeis pela Universidade Federal do Rio Grande do Norte - UFRN (2022). Graduada em Ciências Contábeis pela Universidade Federal Rural do Semi-Árido - UFERSA (2019). 

Atelmo Ferreira de Oliveira, Universidade Federal do Rio Grande do Norte (UFRN)

Doutor (2018) em Ciências Contábeis pelo Programa Multiinstitucional e Inter-regional de Pós-graduação (Unb/UFPB/UFRN), mestrado (2003) em Ciência Contábeis pelo Programa Multiinstitucional e Inter-regional de Pós-graduação (UnB/UFPB/UFRN/UFPE), especialização em Contabilidade Gerencial (1998) pela Universidade Federal do Rio Grande do Norte e graduação em Ciências Contábeis (1991). Professor efetivo na Universidade Federal do Rio Grande do Norte - UFRN.

Adilson de Lima Tavares, Universidade Federal do Rio Grande do Norte (UFRN)

Possui graduação em Ciências Contábeis (1995) e especialização em Contabilidade Gerencial (1999) pela Universidade Federal do Rio Grande do Norte, mestrado (2006) e doutorado (2010) em Ciências Contábeis pelo Programa Multiinstitucional e Inter-regional de Pós-graduação em Ciências Contábeis (UnB/UFPB/UFRN). Atualmente é professor da Universidade Federal do Rio Grande do Norte.

Kallyse Priscila Soares de Oliveira Freire, Universidade Federal Rural do Semi Árido (UFERSA)

Possui graduação em Ciências Contábeis pela Universidade Estadual da Paraíba. Possui mestrado em Ciências Contábeis pelo Programa MultiInstitucinal UNB/UFPB/UFRN e Doutorado em Ciências Contábeis pelo Programa de Pós-Graduação em Ciências Contábeis da Universidade Federal da Paraíba. Atualmente é professora efetiva da Universidade Federal Rural do Semi Árido (UFERSA).

References

Adams, R. B., Almeida, H., & Ferreira, D. (2005). Powerful CEOs and Their Impact on Corporate Performance. Review of Financial Studies, 18(4), 1403–1432. https://doi.org/10.1093/rfs/hhi030

Ali, A., & Zhang, W. (2015). CEO tenure and earnings quality. Journal of Accounting and Economics, 59(1), 60-79. https://doi.org/10.1016/j.jacceco.2014.11.004

Alqatamin, R. M., Aribi, Z. A., & Arun, T. (2017). The effect of the CEO’s characteristics on EM: Evidence from Jordan. International Journal of Accounting & Information Management, 25(3), 356-375. https://doi.org/10.1108/IJAIM-10-2016-0099

Ameila, A., & Eriandani, R. (2021). CEO characteristics and earnings management: evidence from indonesia. Journal of Management and Business, 20(2), 51-63. https://doi.org/10.24123/jmb.v20i2

Ashafoke, T., Dabor, E., & Ilaboya, J. (2021). Do CEO characteristics affect financial reporting quality? An empirical analysis. Acta Universitatis Danubius. Œconomica, 17(1).

Baker, T. A., Lopez, T. J., Reitenga, A. L., & Ruch, G. W. (2019). The influence of CEO and CFO power on accruals and real earnings management. Review of Quantitative Finance and Accounting, 52, 325-345. https://doi.org/10.1007/s11156-018-0711-z

Barker, R. G. (1999). The role of dividends in valuation models used by analysts and fund managers. European Accounting Review, 8(2), 195-218. https://doi.org/10.1080/096381899335998

Bergstresser, D., & Philippon, T. (2006). CEO incentives and earnings management. Journal of financial economics, 80(3), 511-529. https://doi.org/10.1016/j.jfineco.2004.10.011

Berle, A. A., & Means, G. G. C. (1991). The modern corporation and private property. Transaction publishers.

Bouaziz, D., Salhi, B., & Jarboui, A. (2020). CEO characteristics and earnings management: empirical evidence from France. Journal of Financial Reporting and Accounting, 18(1), 77-110. https://doi.org/10.1108/JFRA-01-2019-0008

Cella, C., Ellul, A., & Gupta, N. (2017). Learning through a smokescreen: Earnings management and CEO compensation over tenure. Riksbank Research Paper Series Forthcoming, Kelley School of Business Research Paper, (15-18), 15-02.

Chou, Y. Y., & Chan, M. L. (2018). The impact of CEO characteristics on real earnings management: Evidence from the US banking industry. Journal of Applied Finance and Banking, 8(2), 17-44.

Cornett, M. M., Marcus, A. J., & Tehranian, H. (2008). Corporate governance and pay-for-performance: The impact of earnings management. Journal of financial economics, 87(2), 357-373. https://doi.org/10.1016/j.jfineco.2007.03.003

Corrêa, R. F.,Abreu,Y. C. R.,Garcia, I. A. S.,& Silva, A. R. P. (2024). Influência do CEO Power no endividamento das empresas da B3. Revista de Contabilidade e Organizações, 18:e220491. http://dx.doi.org/10.11606/issn.1982-6486.rco.2024.220491

Demirakos, E. G., Strong, N. C., & Walker, M. (2004). What valuation models do analysts use?. Accounting horizons, 18(4), 221-240. https://doi.org/10.2308/acch.2004.18.4.221

Fama, E. F., & Jensen, M. C. (1983). Agency problems and residual claims. The journal of law and Economics, 26(2), 327-349. https://doi.org/10.1086/467037

Fields, T. D., Lys, T. Z., & Vincent, L. (2001). Empirical research on accounting choice. Journal of accounting and economics, 31(1-3), 255-307. https://doi.org/10.1016/S0165-4101(01)00028-3

Garcia, I. A. S., Medeiros, M. N., & Leite Filho, P. A. M. (2022). Influência do CEO power na probabilidade de sobrevivência das empresas brasileiras de capital aberto da B3. Enfoque: Reflexão Contábil, 41(2), 123-141. https://doi.org/10.4025/enfoque.v41i2.55279

Gulzar, M. A. (2011). Corporate governance characteristics and earnings management: Empirical evidence from Chinese listed firms. International Journal of Accounting and Financial Reporting, 1(1), 133.

Hambrick, D. C., & Mason, P. A. (1984). Upper echelons: The organization as a reflection of its top managers. Academy of management review, 9(2), 193-206. https://doi.org/10.5465/amr.1984.4277628

Hambrick, D. C. (2007). Upper echelons theory: An update. Academy of management review, 32(2), 334-343. https://doi.org/10.5465/amr.2007.24345254

Healy, P. M., & Wahlen, J. M. (1999). A review of the earnings management literature and its implications for standard setting. Accounting horizons, 13(4), 365-383. https://doi.org/10.2308/acch.1999.13.4.365

Huang, H. W., Rose-Green, E., & Lee, C. C. (2012). CEO age and financial reporting quality. Accounting horizons, 26(4), 725-740. https://doi.org/10.2308/acch-50268

Isidro, H., & Gonçalves, L. (2011). Earnings management and CEO characteristics in Portuguese firms. Corporate Ownership and Control, 1(1), 87-95.

Jensen, M., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of financial economics, 3(4), 305-360. https://doi.org/10.1016/0304-405X(76)90026-X

Lev, B., & Sunder, S. (1979). Methodological issues in the use of financial ratios. Journal of accounting and economics, 1(3), 187-210. https://doi.org/10.1016/0165-4101(79)90007-7

Martinez, A. L. (2008). Detectando earnings management no Brasil: estimando os accruals discricionários. Revista Contabilidade & Finanças, 19, 7-17. https://doi.org/10.1590/S1519-70772008000100002

Manzzioni, S., Prigol, V., de Moura, G. D., & Klann, R. C. (2015). Influência da governanca corporativa e da estructura de capital no gerenciamento de resultados. Revista Contemporânea de Contabilidade, 12(27), 61-85. http://doi.org/10.5007/2175-8069.2015v12n27p61

Musa, A., Abdul Latif, R., & Abdul Majid, J. (2023). CEO attributes, board independence, and real earnings management: Evidence from Nigeria. Cogent Business & Management, 10(1), 2194464. https://doi.org/10.1080/23311975.2023.2194464

Oussii, A.A. e Klibi, M.F. (2023). A dualidade e a experiência do CEO afetam o comportamento de gerenciamento de resultados? O efeito moderador da propriedade familiar. Journal of Family Business Management, 13(4), 1392-1409. https://doi.org/10.1108/JFBM-03-2023-0030

Pae, J. (2005). Expected accrual models: the impact of operating cash flows and reversals of accruals. Review of Quantitative Finance and Accounting, 24, 5-22. https://doi.org/10.1007/s11156-005-5324-7

Piccoli, P. G. R., Souza, A., & da Silva, W. V. (2014). As práticas de governança corporativa diminuem o gerenciamento de resultados? Evidências a partir da aversão na divulgação de prejuízos e de queda nos lucros. Revista Contemporânea de Contabilidade, 11(22), 141-162. https://doi.org/10.5007/2175-8069.2014v11n22p141

Prencipe, A., Markarian, G., & Pozza, L. (2008). Earnings management in family firms: Evidence from R&D cost capitalization in Italy. Family Business Review, 21(1), 71-88. https://doi.org/10.1111/j.1741-6248.2007.00112.x

Putra, A.A., & Setiawan, D. (2024), "Do CEO characteristics affect earnings management?", Corporate Governance, 24(5), 1137-1155. https://doi.org/10.1108/CG-02-2023-0078

Qawasmeh, S., & Azzam, M. (2020). CEO characteristics and earnings management. Accounting, 6(7), 1403-1410. https://doi.org/10.5267/j.ac.2020.8.009

Roychowdhury, S. (2006). Earnings management through real activities manipulation. Journal of accounting and economics, 42(3), 335-370. https://doi.org/10.1016/j.jacceco.2006.01.002

Setyaningrum, G. C., Sekarsari, P. S. S., & Damayanti, T. W. (2019). Pengaruh Eksekutif Wanita (Female Executive) terhadap Manajemen Laba (Studi Empiris pada Perusahaan di Bursa Efek Indonesia). ProBank, 4(1), 98-110. https://doi.org/10.36587/probank.v4i1.453

Sprenger, K. B., Kronbauer, C. A., & Costa, C. M. (2017). Características do CEO e o gerenciamento de resultados em empresas listadas na BM&FBovespa. Revista Universo Contábil, 13(3), 120-142.

Sukeecheep, S., Yarram, S. R., & Farooque, O. A. (2013, March). Earnings management and board characteristics in Thai listed companies. In International Conference on Business, Economics and Accounting (pp. 1-14).

Yang, M. L. (2010). The impact of controlling families and family CEOs on earnings management. Family Business Review, 23(3), 266-279. https://doi.org/10. 1177/0894486510374231

Downloads

Published

2024-12-30

How to Cite

Pereira da Silva, A. R., Ferreira de Oliveira, A., Tavares, A. de L., & Freire, K. P. S. de O. (2024). CHARACTERISTICS OF BRAZILIAN CEOS AND RESULTS MANAGEMENT. Revista Mineira De Contabilidade, 25(3), 80–94. https://doi.org/10.51320/rmc.v25i3.1611

Issue

Vol. 25 No. 3 (2024): 3º Quadrimestre de 2024

Section

Artigos científicos:

License

Copyright (c) 2024 Annandy Raquel Pereira da Silva, Atelmo Ferreira de Oliveira, Adilson de Lima Tavares, Kallyse Priscila Soares de Oliveira Freire

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Autores que publicam nesta revista concordam com os seguintes termos: 

a)      Os autores mantêm os direitos autorais e concedem à revista o direito de primeira publicação, com o trabalho simultaneamente licenciado sob a Licença Attribution-NonCommercial-ShareAlike 4.0 International, que permite o compartilhamento do trabalho com reconhecimento da autoria e publicação inicial nesta revista. Essa licença permite que outros remixem, adaptem e criem a partir do seu trabalho para fins não comerciais, desde que atribuam a você o devido crédito e que licenciem as novas criações sob termos idênticos.

b) Não cabe aos autores compensação financeira a qualquer título, por artigos ou resenhas publicados na Revista Mineira de Contabilidade. 

c) Os conceitos expressos nos artigos publicados pela RMC são de inteira responsabilidade de seus autores. 

Creative Commons Atribuição 4.0 Internacional