Corporate Governance, CEO Compensation and accounting conservatism

Pakamas Srichoke, Georgios Georgakopoulos, Alexandros Sikalidis and Athina Sotiropoulou
Additional contact information
Pakamas Srichoke: University of Amsterdam, Amsterdam Business School, Plantage Muidergracht 12, 1018 TV, Netherlands
Georgios Georgakopoulos: Agricultural University of Athens, Iera Odos 75, Athens 118 55, Greece
Alexandros Sikalidis: International Hellenic University, 14th km Thessaloniki- Nea Moudania 57001, Greece
Athina Sotiropoulou: University of Patras, University Campus, 26504 Rio Achaia, Greece

International Journal of Business and Economic Sciences Applied Research (IJBESAR), 2021, vol. 14, issue 1, 80-95

Abstract: Purpose: This study examines the moderating impact of corporate governance quality on the relation between CEO bonus compensation and accounting conservatism. Design/methodology/approach: We use market-based and accrual-based measures to estimate accounting conservatism. According to prior literature (Core, Holthausen and Larcker, 1999; Bhojraj and Sengupta, 2003; Rees and Rodionova, 2015), agency and managerial self-interest theory state that corporate governance strength can mitigate the negative relation between CEO bonus compensation and accounting conservatism. Finding: Our sample consists of S&P 500 companies while our empirical findings suggest that CEO bonus compensation and accounting conservatism are positively associated. Research limitations/implications: Thus, our results do not provide clear evidence about the direction of the effect of strong corporate governance. Both measures of accounting conservatism do not give significant relations, therefore the results about corporate governance strength are contradicting. The results hold the same after controlling for industry-specific effects. Originality/value: The purpose of this study is to shed light to the literature of accounting conservatism, corporate governance and CEO compensation. Furthermore, this research examines the current situation of corporate governance and motivates future improvement of corporate governance mechanisms.

Keywords: Corporate Governance; Executive Compensation; Accounting and Auditing (search for similar items in EconPapers)
JEL-codes: G3 M12 M4 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://ijbesar.af.duth.gr/docs/volume14_issue1/14_01_07.pdf (application/pdf)
https://ijbesar.af.duth.gr/volume14_issue1.php (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tei:journl:v:14:y:2021:i:1:p:80-95

Access Statistics for this article

International Journal of Business and Economic Sciences Applied Research (IJBESAR) is currently edited by Christos Grose and Persefoni Polychronidou

More articles in International Journal of Business and Economic Sciences Applied Research (IJBESAR) from Democritus University of Thrace (DUTH), Kavala Campus, Greece Contact information at EDIRC.
Bibliographic data for series maintained by Kostas Stergidis ().