Year: 2026
Type: article
Abstract: This paper investigates the effect of mutual tenure between chairperson and CEO on real earnings management using companies in Turkey where strong interpersonal relationships and close connections predominate and adopting agency theory. The results of various estimation procedures indicate that mutual tenure increases discretionary real activities. In further analyses, while independent member percentage on boards moderates this association, non-independent female member percentage mediates this association. In additional analysis, the mutual tenure among chairperson-CEO with the same surname and from the same hometown leads to a greater increase in REM. In the initial year(s) of mutual tenure, REM is low; however, as the years progress, particularly in the later years, this relationship reverses. Alternative financial reporting quality measurements such as audit opinion and reporting lag confirm our main results. Finally, when we run the main model with the REM components, we do not find any association only between mutual tenure and discretionary production costs.
Source: Review of Managerial Science
Authors: Emrah Arioglu, Murat Ocak
Institutions: Minnesota State University Moorhead, Trakya University
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $3,190
Funder: Trakya Üniversitesi
OpenAlex ID: W7161490009