Unified or divided? Conflicting interests of controlling shareholders in corporate tax avoidance

Sun-ae Cho, Sangil Kim and Won-Wook Choi

Emerging Markets Review, 2025, vol. 68, issue C

Abstract: This study examines the heterogeneity among controlling shareholders on corporate tax avoidance. Findings reveal that controlling shareholders are divided on tax avoidance behavior, which leads to less tax avoidance; however, they are unified in earnings management and R&D expenditure. Additional analysis shows that their divided interests are influenced by several factors, such as shareholder type, related-party transactions, family business status, Chaebol affiliation, and firm maturity. This study underscores that controlling shareholders, once considered a single entity, encompass individuals who counterbalance each other's interests; thus, reassessing their corporate governance role is necessary.

Keywords: Controlling shareholder; Heterogeneity; Related party; Tax avoidance (search for similar items in EconPapers)
JEL-codes: G30 G34 G39 H20 H25 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ememar:v:68:y:2025:i:c:s1566014125000883

DOI: 10.1016/j.ememar.2025.101339

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