Vel e, Pa ick
A icle — Published Ve sion
The link be ween co po a e go e nance and co po a e
inancial misconduc . A e iew o a chi al s udies and
implica ions o u u e esea ch
Managemen Re iew Qua e ly
P o ided in Coope a ion wi h:
Sp inge Na u e
Sugges ed Ci a ion: Vel e, Pa ick (2021) : The link be ween co po a e go e nance and co po a e
inancial misconduc . A e iew o a chi al s udies and implica ions o u u e esea ch, Managemen
Re iew Qua e ly, ISSN 2198-1639, Sp inge In e na ional Publishing, Cham, Vol. 73, Iss. 1, pp.
353-411,
h ps://doi.o g/10.1007/s11301-021-00244-7
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Managemen Re iew Qua e ly (2023) 73:353–411
h ps://doi.o g/10.1007/s11301-021-00244-7
1 3
The link be weenco po a e go e nance andco po a e
inancial misconduc . A e iew o a chi al s udies
andimplica ions o  u u e esea ch
Pa ickVel e1
Recei ed: 7 Augus 2021 / Accep ed: 15 Oc obe 2021 / Published online: 2 No embe 2021
© The Au ho (s) 2021
Abs ac
In his a icle, we e iew ecen a chi al esea ch a icles (98 s udies) on he impac
o co po a e go e nance on es a emen s, en o cemen ac i i ies and aud as co -
po a e inancial misconduc . Applying an agency- heo e ical iew, we mainly di -
e en ia e be ween ou le els o co po a e go e nance (g oup, indi idual, i m,
and ins i u ional le el). We ind ha inancial es a emen s on he one hand and he
g oup and indi idual le el o co po a e go e nance on he o he hand a e domi-
nan in ou li e a u e e iew. En o cemen ac ions and aud e en s as misconduc
p oxies, and he i m and ins i u ional le el o co po a e go e nance a e o lowe
ele ance ye . The ollowing e iew highligh s ha many s udies on co po a e go -
e nance ind inconclusi e esul s on i ms’ inancial misconduc . Bu he e a e indi-
ca ions ha boa d expe ise and especially gende di e si y in he op managemen
dec eases i ms’ inancial misconduc . We know e y li le abou he impac o non-
sha eholde s akeholde s’ moni o ing ole on misconduc ye . In discussing po en ial
u u e esea ch, we emphasize he need o a mo e de ailed analysis o misconduc
p oxies, ecogni ion o mode a o and especially media o a iables, especially in
he in e play o he boa d o di ec o s and ex e nal audi o s.
Keywo ds Co po a e inancial misconduc · Co po a e go e nance· Res a emen s·
En o cemen · Boa d composi ion· Owne ship s uc u e
JEL Classi ica ion M41· M48· Q56
* Pa ick Vel e
[email p o ec ed]
1 Ins i u e o Managemen , Accoun ing andFinance, Leuphana Uni e si y Luenebu g,
Uni e si ä sallee 1, 21335Luenebu g, Ge many
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P.Vel e
1 3
1 In oduc ion
In ligh o p ominen inancial scandals (e.g., En on, Wo ldcom, Wi eca d), a p ope
inancial epo ing quali y is c ucial o s akeholde us . Fi m’s inancial miscon-
duc can lead o massi e nega i e consequences o capi al p o ide s, employees,
cus ome s, supplie s and he whole economy. Du ing he las yea s, many con o e -
sial discussions a ise which mechanisms may p e en o e en disco e une hical and
oppo unis ic beha io o i ms. In iew o his ele ance, his sys ema ic li e a u e
e iew ocusses on a chi al esea ch on he ela ionship be ween co po a e go e n-
ance and i ms’ inancial misconduc . In line wi h Ami am e al. (2018), we de ine
i ms’ inancial misconduc as iola ions o na ional and/o in e na ional accoun ing
and ela ed business law egula ions and s anda ds. Thus, we make a clea dis inc-
ion be ween ea nings managemen and i ms’ inancial misconduc .1 We a e awa e
o he ac ha disc e iona y acc uals and ela ed p oxies o ea nings managemen
may be signi ican p edic o s o i ms’ inancial misconduc (Ami am e al. 2018),
leading o a “g ey zone” be ween ea nings managemen and iola ions o accoun -
ing s anda ds. While he US-Ame ican li e a u e does no clea ly sepa a e be ween
ea nings managemen and iola ions, he Con inen al Eu opean accoun ing li e a-
u e mainly s esses ha ea nings managemen is in line wi h he espec i e law and
s anda ds (e.g., Hi schle 2021). We e e o his assump ion, exclude s udies on he
link be ween co po a e go e nance and ea nings managemen and e e o p io li -
e a u e e iews and me a-analyses (e.g., Ga cia-Meca and Sanchez-Balles a 2009;
Lin and Hwang 2010).
Re e ing o he co po a e go e nance amewo k by Jain and Jamali (2016),
we sepa a e ou co po a e go e nance a iables in o ou le els: g oup, indi-
idual, i m, and ins i u ional le el. We iden i y inancial es a emen s, aud
e en s and en o cemen ac i i ies as h ee main ca ego ies o i ms’ inancial
misconduc , ep esen ing a majo h ea o capi al ma ke s (B ody e al. 2012;
Hamme sley 2011). We a e awa e o he ac ha es a emen s a e no neces-
sa ily he esul o aud, as unin en ional e o s may also esul in o es a e-
men s. Fi ms’ inancial scandals lead o dec eased us be ween co po a ions,
ga ekeepe s, ma ke pa icipan s, and o he s akeholde g oups, because i ms
may go bank up o may ha e ex eme inancial p oblems i hese scandals go
public (B ody e  al. 2012). The e is empi ical e idence ha nega i e inan-
cial consequences, e.g., majo losses in i m alua ion, and inc eased capi al
cos s, o highe execu i e u no e will ollow (Habib e  al. 2020). We no e
he amous En on scandal and he insol ency o Wi eca d, one o he o me
“DAX 30” in ech g oup companies in Ge many, as p ominen examples o
a big loss in capi al ma ke us . Many na ional and in e na ional legisla o s,
1 In ou li e a u e e iew, we exclude s udies wi h a ocus on ea nings managemen as majo p oxy o
inancial epo ing quali y. Ea nings managemen includes legal op ions o in luence he inancial s a e-
men and o he inancial epo ing in o ma ion om a quan i a i e and/o quali a i e way. In con as o
his, ou in e p e a ion o i ms’ inancial misconduc solely deals wi h iola ions o ecen (in e )na ional
accoun ing s anda ds and ela ed egula ions.
355
1 3
The link be weenco po a e go e nance andco po a e inancial…
e.g., he Eu opean Commission and he B i ish Go e nmen , cu en ly discuss
u u e co po a e go e nance egula ions, e.g., whis leblowing sys ems o isk
managemen ools.
Acco ding o he amous aud iangle by C essey (1953),2 he possibili y
o i ms’ misconduc is based on h ee condi ions. Fi s , incen i es and p es-
su es mus be exis en o commi misconduc . Second, he e mus be an a i ude
o a a ionaliza ion commi ing misconduc . Thi d, he e mus be any ci cum-
s ance which p o ides an incen i e o an oppo uni y o misconduc . Incen-
i es o oppo uni ies may be caused by ine ec i e moni o ing o op manage-
men , complex o ganiza ional s uc u es o ine ec i e con ols due o a lack o
moni o ing o con ols o ci cum en ion o con ols. In line wi h agency heo y,
in e nal and ex e nal co po a e go e nance as moni o ing mechanisms should
dec ease execu i es’ oppo uni ies o inancial misconduc . In a adi ional
sense, co po a e go e nance “deals wi h he ways in which supplie s o inance
o co po a ions assu e hemsel es on ge ing a e u n on hei in es men ”
(Shlei e and Vishny 1997). As we also like o in eg a e o he s akeholde
g oups, we e e o he co po a e go e nance de ini ion as “ he combina ion o
mechanisms which ensu e ha he managemen […] uns he i m o he bene-
i o one o se e al s akeholde s” (Goe gen and Renneboog 2006). We use his
b oad de ini ion o co po a e go e nance, because we belie e ha he a e o a
i m no only depends on he ela ions be ween managemen and sha eholde s,
bu also on he ela ion be ween managemen and o he s akeholde s who p o-
ide non- inancial esou ces o he i m (F eeman 1984).
In ou li e a u e e iew, based on 98 s udies, we analyze whe he co po-
a e go e nance a iables on ou di e en le els (g oup, indi idual, i m, and
ins i u ional le el) a e linked wi h he p obabili y o i ms’ inancial miscon-
duc . Wi h ega d o he g oup le el as he dominan ca ego y in ou li e a u e
e iew, we sepa a e be ween (1) boa d composi ion, (2) boa d compensa ion,
(3) audi commi ees and he in e nal audi unc ion as moni o ing ins i u ions.
The indi idual le el o co po a e go e nance e e s o speci ic cha ac e is ics
o he Chie Execu i e O ice (CEO) and/o he Chie Financial O ice (CFO)
in iew o hei majo impac on inancial epo ing quali y. The i m le el o
co po a e go e nance can be di ided in o owne ship s uc u e and moni o ing
by o he s akeholde s. Las bu no leas , ou e iew also includes legal en o ce-
men as pa o he ins i u ional le el o co po a e go e nance. We exclude he
ex e nal audi o as a main de e minan o he p e en ion o inancial miscon-
duc in iew o he massi e esea ch ac i i y on his opic and o he speci ic
li e a u e e iews on ha opic (e.g., Hogan e al. 2008; T ompe e e al. 2014).
Du ing he las decade, a ious s udies ha e been conduc ed o measu e he
impac o co po a e go e nance on i ms’ inancial misconduc , showing he -
e ogeneous esul s (Habib e al. 2020). Financial es a emen s can be classi ied
2 The aud iangle was la e ex ended by he aud diamond by Wol e and He manson (2004), who
added one new componen (capabili y). Mo eo e , he aud pen agon by Ma ks (2012) was classi ied by
ano he componen o he aud heo y (a ogance).
356
P.Vel e
1 3
as he mos impo an a iable o i ms’ inancial misconduc in p io esea ch
(e.g., Ka po e al. 2017). This can be easily explained by me hodological ea-
sons. Empi ical-quan i a i e esea ch equi es an adequa e numbe o obse a-
ions and compa able p oxies. As inancial es a emen s a e a common p ac ice
in business li e and se e al da abases exis (e.g., audi analy ics), esea che s
like o choose inancial es a emen s as a p oxy o inancial misconduc (Has-
nan e  al. 2013). The o he wo ca ego ies, en o cemen ac i i ies and aud
e ens, a e o lowe ele ance in empi ical-quan i a i e esea ch ye (e.g., Has-
nan e al. 2013). This can be explained by he lowe p ac ical ele ance o aud
e en s and en o cemen ac i i ies and he lowe alidi y o da abases which
dec eases he numbe o obse a ions o he esea che s.
Ou goal is o examine he o e all ela ionship be ween co po a e go e n-
ance and i ms’ inancial misconduc in p io s udies. Thus, o gain an adequa e
le el o compa abili y wi hin he included s udies, we only include a chi al
s udies as dominan esea ch me hod in his esea ch opic. Mo eo e , as a chi-
al esea ch ela ed o ou esea ch s eng h hea ily elies on he US-Ame ican
capi al ma ke and is mainly in luenced by he Sa banes Oxley Ac (SOX) o
2002 (DeFond and Zhang 2014), we only include pos -SOX-s udies (s a ing
wi h he business yea 2006). Co po a e go e nance was massi ely changed by
he SOX as a eac ion o he En on scandal (DeFond and Zhang 2014). The
inc eased egula ions on audi commi ee p o isions, in e nal con ol audi s,
inspec ions o he Public Company Accoun ing O e sigh Boa d (PCAOB) and
p osc ip ion o non audi se ices ha e a main impac o co po a e go e nance
quali y and hei impac on inancial es a emen s, en o cemen ac ions and
aud. Thus, esea ch designs p e and pos SOX a e no compa able. Includ-
ing bo h domes ic and o eign issue s on he US-Ame ican capi al ma ke ,
he be o e men ioned co po a e go e nance egula ions had o be ul illed o
he business yea 2006 o he i s ime. As a consequence, we only include
esea ch designs ha include a leas he business yea 2006. A e he passing
o he SOX) o 2002, se e al coun ies implemen ed simila egula ions, so ha
he SOX is likely o be an in e na ional ca alys o a global co po a e go e n-
ance e o m ini ia i e du ing he las wo decades.
We s ess a g owing amoun o li e a u e e iews on i ms’ inancial miscon-
duc in gene al (e.g., Sie e s and So ilkani sch 2019a, b) and on ela ed miscon-
duc measu es (e.g., Ka po e al. 2017; Selle s e al. 2020). We iden i y wo
me a-analysis on he impac o co po a e go e nance on inancial es a emen s
(Habib e al. 2020) and on he link be ween boa d independence and co po a e
misconduc (Ne ille e al. 2019). We see a majo esea ch gap on conduc ing a
li e a u e e iew on p io co po a e go e nance esea ch in iew o he ollow-
ing easons: Fi s , a chi al co po a e go e nance esea ch has been inc eased
du ing he las decade and show he e ogeneous esul s, leading o i s me a-
analyses (Habib e al. 2020; Ne ille e al. 2019). P io me a-analyses ha e used
di e en me hods, a iables, and mode a o s, s essing he need o he s uc u e
he main esea ch s eng hs by a na a i e li e a u e e iew. As me a-analyses
and s uc u ed li e a u e e iews ep esen sepa a e esea ch me hods wi h di -
e en aims, he e is a need o a li e a u e e iew on he espec i e opic in

357
1 3
The link be weenco po a e go e nance andco po a e inancial…
line wi h p io me a-analyses. Second, in line wi h agency heo y, i is ques-
ionable whe he co po a e go e nance is eally linked wi h educed i m’s
inancial misconduc . We hus like o analyze whe he co po a e go e nance
ep esen s a moni o ing ool o dec ease in o ma ion asymme y be ween man-
agemen and sha eholde s and inc ease inancial epo ing quali y and which
speci ic a iables con ibu e o his link. In con as o Habib e al. (2021), we
do no only concen a e on inancial es a emen s and we do no include ex e -
nal audi p oxies. We also e e o a co po a e go e nance amewo k wi h a
clea s uc u e o co po a e go e nance le els in con as o Habib e al. (2021).
In con as o Ne ille e al. (2019), we a e no only in e es ed in he impac o
boa d independence on co po a e misconduc . Mo eo e , as me a-analyses ha e
di e en goals in compa ison o s uc u ed li e a u e e iews, ocusing on na -
a i e esul s and endencies o p io esea ch ins ead o s a is ical co ela ions,
we make a main con ibu ion o p io me a-analyses on ela ed opics. Ou aim
is no o es s a is ical co ela ions bu o iden i y majo endencies o p io
esea ch, s ess he a ie y o included p oxies and deduce ui ul ecommen-
da ions o u u e esea ch designs.
Re e ing o exis ing li e a u e e iews on ou esea ch opic, p io analy-
ses did no es ic hei sample on inancial misconduc , bu also include o he
measu es o inancial epo ing quali y as ea nings managemen (e.g., Ploeck-
inge e al. 2016) o o he de e minan s o inancial mis epo ing (e.g., Sie -
e s and So ilkani sch 2019a, b; Tu ino and Me lo 2019a, b). O he esea che s
es ic hei analysis on selec i e co po a e go e nance a iables and es a e-
men s (e.g., S ee and He manson 2019). As we al eady no ed, we like o con-
duc a di e en s a egy.
As a consequence, we make main con ibu ions o p io li e a u e e iews on
ha opic. Fi s , we ely on a chi al esea ch (pos -SOX yea s) on he impac
o co po a e go e nance on a ious p oxies o i m’s inancial misconduc in
iew o he massi e impac o he SOX on co po a e go e nance and he domi-
nan use o he US-Ame ican capi al ma ke in ou sample. Second, we clea ly
di e en ia e be ween ou le els o co po a e go e nance o he i s ime on
he one hand due o a co po a e go e nance amewo k, and h ee ca ego ies
o misconduc ( es a emen s, en o cemen ac i i ies, and aud e en s) on he
o he hand. Wi h he help o his s uc u e, we lis and compa e he a ious co -
po a e go e nance a iables and deduc limi a ions and ecommenda ions o
u u e esea ch.
Ou e iew o 98 a chi al s udies s esses majo gaps in ecen co po a e
go e nance esea ch and highligh s key challenges ha esea che s ace in hei
esea ch designs. Fi s , ou e iew s esses ha inancial es a emen s as mis-
conduc p oxy and he g oup and indi idual le el o co po a e go e nance ep-
esen he mos impo an ca ego ies in ou li e a u e e iew. En o cemen and
aud e en s, and he i m and ins i u ional le el o co po a e go e nance a e
o lowe ele ance ye . Ou e iew also highligh s ha many s udies on co po-
a e go e nance a iables ind inconclusi e esul s on i ms’ inancial miscon-
duc . Bu he e a e indica ions ha expe ise and especially gende di e si y
(on he boa d, on audi commi ees and emale CEOs) dec ease i ms’ inancial
358
P.Vel e
1 3
misconduc . Howe e , we know e y li le abou he impac o o he non-sha e-
holding s akeholde s as a moni o ing ool on misconduc . Second, in discussing
po en ial u u e esea ch, we emphasize he need o a mo e de ailed analysis
o es a emen s p oxies, ecogni ion o mode a o and especially media o a i-
ables, and inc eased inclusion o in e ac ions be ween audi commi ees and
ex e nal audi o s.
Ou analysis is s uc u ed as ollows: Fi s , we p esen an agency- heo e ical
ounda ion and ou esea ch amewo k, s essing ou co po a e go e nance
amewo k and ela ed de e minan s o i ms’ inancial misconduc and he
h ee main ca ego ies o misconduc (Sec .2). Nex , we p esen he key esul s
o ou li e a u e e iew, whe eas we di e en ia e be ween se e al cha ac e is-
ics o in e nal and ex e nal co po a e go e nance (Sec .3). Ou analysis con-
inues wi h a discussion o ou esul s and esea ch ecommenda ions (Sec .4).
Sec ion5 p o ides a conclusion o ou analysis.
2 Agency‑ heo e ical amewo k o included co po a e go e nance
andmisconduc a iables
2.1 Co po a e go e nance measu es
The link be ween co po a e go e nance and i ms’ inancial misconduc can
be mo i a ed by a ious heo ies (e.g., s akeholde heo y, legi imacy heo y,
esou ce-based iew; see Habib e al. 2021). As he majo i y o included s ud-
ies in his li e a u e e iew e e ed o agency heo y (Ross 1973; Jensen and
Meckling 1976), we also use his heo e ical app oach. Based on he sepa a-
ion o owne ship and con ol, Jensen and Meckling (1976) cha ac e ize he
o e a ching p oblem o in o ma ion asymme ies be ween managemen and
sha eholde s, esul ing in mo al haza ds and sel -se ing ac ions. To dec ease
hose agency con lic s, he e is a need o implemen s ong moni o ing mecha-
nisms by he boa d o di ec o s and i s sha eholde s. In o ma ion asymme ies
a ise in he inancial epo ing documen s, as inancial epo ing quali y may
be educed by e o s and aud, leading o es a emen s, en o cemen ac i i-
ies and aud e en s, which may go public. The eal economic pe o mance o
he i m is no ob ious in hese si ua ions and impai he in o ma ion unc ion
o he sha eholde s. E ec i e co po a e go e nance should pu p essu e on op
managemen s o p e en o a leas educe i ms’ inancial misconduc , leading
o ewe es a emen s, en o cemen ac ions o aud e en s (Jensen and Meck-
ling 1976). Co po a e go e nance can be classi ied as a moni o ing ool in line
wi h sha eholde s’ in e es s o e hical managemen beha iou . We expec ha
inc eased co po a e go e nance quali y is linked wi h be e inancial epo ing
quali y and hus lowe p obabili y o i ms’ inancial misconduc .
In he ollowing, we p esen he s uc u e o ou co po a e go e nance
a iables. As he e a e many di e en co po a e go e nance amewo ks in
he li e a u e (e.g., Cohen e al. 2004), we ely on he amewo k by Jain and
Jamali (2016) who di e en ia e ou le els o co po a e go e nance. (1) The
359
1 3
The link be weenco po a e go e nance andco po a e inancial…
g oup le el o co po a e go e nance mainly ela es o he boa d as a mecha-
nism o moni o ing manage s o a oid agency con lic s (Jain and Jamali 2016).
Boa d s uc u e (e.g., independence), social capi al and esou ce ne wo k and
demog aphy a e main p oxies in his con ex . In ou li e a u e e iew, we dis-
inguish be ween h ee main ca ego ies o he g oup le el: boa d composi ion,
boa d compensa ion and audi commi ees and he in e nal audi unc ion. (2)
The indi idual le el o co po a e go e nance add esses demog aphic o socio-
psychological cha ac e is ics o speci ic membe s o he op managemen . The
CEO and he CFO ep esen he wo mos impo an pe sons who a e included
in p io empi ical co po a e go e nance esea ch. Thus, we include CEO and/
o CFO cha ac e is ics, e.g., na cissism, o enu e, in his le el. (3) The i m
le el o co po a e go e nance mainly concen a es on owne ship s uc u e (e.g.,
blockholding, owne ship concen a ion; Jain and Jamali 2016). Du ing he
las yea s, also o he s akeholde s moni o he boa d o di ec o s, e.g., inan-
cial analys s o a ing agencies. Thus, we sepa a e be ween owne ship s uc u e
and moni o ing by o he s akeholde s. (4) Las bu no leas , he ins i u ional
le el o co po a e go e nance includes o mal ins i u ions, e.g., poli ical, legal,
and inancial sys ems, as well as in o ma ion ins i u ions, e.g., socially alued
belie s and no ms (Jain and Jamali 2016).
2.2 G oup le el
The g oup le el o co po a e go e nance is mainly linked o he composi ion o
he boa d, i s commi ees and he in e nal audi unc ion. Main boa d a iables
include boa d independence, expe ise, gende di e si y, ne wo ks and social
ies and may lead o inc eased quali y o inancial epo ing. Managemen
should ac in line wi h sha eholde s’ in e es s in p e en ing inancial miscon-
duc . The boa d o di ec o s, a he apex o in e nal con ol sys ems, ad ise and
moni o he managemen (execu i e di ec o s) and has o du y o hi e, i e, and
o compensa e he senio managemen (Gillan and S a ks 2000; Shlei e and
Visny 1997). Agency heo y assumes ha p ope boa d composi ion and com-
pensa ion leads o inc eased alidi y o inancial epo ing and e hical beha -
iou (Jensen and Meckling 1976). Based on agency heo y, in ou li e a u e
e iew, we assume ha e ec i e boa d composi ion will ha e a nega i e impac
o he occu ence o i ms’ inancial misconduc .
Nex o boa d composi ion, we in oduce he audi commi ee as a cen al
moni o ing au ho i y o he managemen , as well as o he in e nal and ex e nal
audi o , and i in o mally sha es in o ma ion wi h all h ee co po a e go e n-
ance bodies (Pome oy and Tho n on 2008). The majo ole o audi commi -
ees is e en highe in one- ie -sys ems in compa ison o wo- ie -sys em, as he
audi commi ee ep esen s he only ins i u ion in he one- ie -sys em which
moni o s he execu i e di ec o s. Thus, e en hough he managemen p epa es
he inancial epo s, he audi commi ee has a signi ican sha ed esponsibili y
o he achie emen o adequa e quali y, o ins ance h ough he inancial audi
(Gha an and O’Sulli an 2013). The audi commi ee also pe o ms impo an
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moni o ing ac i i ies in ela ion o ex e nal audi o independence which may
also be comp omised by non-audi se ices, o by gene a ing adequa e in e nal
audi esou ces (Vel e 2017). These ac i i ies may esul in dec eased in o ma-
ion asymme y and con lic o in e es s be ween execu i es and sha eholde s,
leading o be e i m epu a ion and i m alua ion. Based on co po a e go -
e nance egula ions a e he En on scandal in he USA, independence om
he managemen and inancial expe ise a e s eng hened o ensu e app op ia e
moni o ing (Vel e and S iglbaue 2011). Bu also o he kinds o expe ise, gen-
de , and ne wo k a e cu en ly discussed. As a esul , audi commi ee e ec-
i eness should be connec ed wi h dec eased es a emen s, en o cemen ac ions
and aud e en s. In line wi h he audi commi ee, he in e nal audi unc ion
also ep esen s a key moni o ing ins i u ion wi hin he i m. As in e nal audi-
o s also ad ise he op managemen membe s, independence is a c ucial ac o
(Ege 2015). As in e nal audi o s should closely coope a e wi h audi commi -
ees and he ex e nal audi o , we assume ha inc eased in e nal audi will lead
o educed inancial misconduc (Ege 2015).
As a hi d ca ego y o he g oup le el o co po a e go e nance, incen i e-
based boa d compensa ion is a classic ool o o e coming con lic s o in e -
es be ween managemen and in es o s (Lynch and William 2012). While i is
ecognized ha execu i e compensa ion should comp ise a balanced mix o
ixed and pe o mance- ela ed componen s, long- e m incen i es ha e played
a key ole since he inancial c isis in 2008/09. Bu managemen compensa-
ion a angemen s a e he e ogeneous om an in e na ional pe spec i e and
no consensus has been ound (Campbell e al. 2015). Execu i e compensa ion
sys ems should di e om non-execu i es’ paymen s in o de o dec ease con-
lic o in e es s be ween hose wo pa ies (Jensen and Mu phy 1990). Thus,
many i ms ely on non-execu i e compensa ion packages comp ising only
ixed componen s o non-execu i es, e.g., audi commi ee membe s. In line
wi h compensa ion s uc u e, he amoun o boa d compensa ion is a majo
challenge in co po a e go e nance esea ch (Jensen and Mu phy 1990). “Exces-
si e” compensa ion and he non-exis ence o pay- o -pe o mance-sensi i i y o
emune a ion con ac s inc ease sha eholde s’ conce ns. This can be explained
by dec eased payou s o sha eholde s, i managemen compensa ion inc eases
while i m pe o mance dec eases (Jensen and Meckling 1976). Thus, eliance
on sho - e m inancial goals in compensa ion con ac s and excessi e paymen
will lead o inc eased i ms’ inancial misconduc . Top manage s may hide
hei unsuccess ul s a egies by book- ela ed inc eases in sho - e m inancial
pe o mance while he eal business ansac ions a e no linked o his inc ease.
In o ma ion asymme ies will be highe because inancial epo ing quali y is
educed and sha eholde s canno analyze he eal economic p o i . Thus, we
assume ha sho - e m compensa ion and excessi e compensa ion o execu-
i es will be connec ed wi h inc eased i ms’ inancial misconduc .
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The link be weenco po a e go e nance andco po a e inancial…
Table 2 Coun o ci ed published pape s
Panel A: by publica ion yea
To al: 98 2021: 4
2020: 11
2019: 16
2018: 17
2017: 10
2016: 10
2015: 7
2014: 4
2013: 9
2012: 8
2010: 1
2009: 1
Panel B: by egion
To al: 98 USA: 59
O he egimes: 38
C oss-coun y se ing: 1
Panel C: by jou nal
To al: 98 Managemen and co po a e go e nance jou nals: 28
Academy o Managemen Jou nal: 1
Asian Academy o Managemen Jou nal: 1
Aus alian Jou nal o Managemen : 1
Co po a e Go e nance: An In e na ional Re iew: 2
Finance Resea ch Le e s: 1
Jou nal o Business E hics: 11
Jou nal o Managemen and Go e nance: 1
In e na ional Jou nal o Managemen and En e p ise
De elopmen : 1
Long Range Planning: 1
Managemen Decision: 1
Managemen Science: 1
P ocedia: 2
S a egic Managemen Jou nal: 2
Sou h Eas Asia Resea ch: 1
Technological Fo ecas ing and Social Change: 1
Accoun ing and Finance jou nals: 70
Accoun ing and Finance: 2
Accoun ing Resea ch Jou nal: 1
Ad ances in Accoun ing: 1
Asia–Paci ic Jou nal o Accoun ing and Economics: 2
Audi ing: A Jou nal o P ac ice and Theo y: 3
Accoun ing Ho izons: 5
Ad ances in Accoun ing: 1
Con empo a y Accoun ing Resea ch: 9

368
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1 3
amewo k. Signi ican indings and hei indica o s we e epo ed as o e-coun -
ing echnique (Ligh and Smi h 1971).
Table 2 p o ides an o e iew o he pape s pe publica ion yea (Panel A),
egion (Panel B), jou nal (Panel C), independen a iable (Panel D) and depend-
en a iabe (Panel E). Panel A epo ed a s eady inc ease in s udies o e he las
ew yea s. The yea s 2018 and 2019 we e mos impo an yea due o he amoun
o included s udies (16/17 s udies). Mos o he included s udies add essed he
US-Ame ican se ing (59 s udies) in compa ison o o he se ings. Wi h one
excep ion, we do no indica e any c oss-coun y se ings. Panel C illus a es a
g ea he e ogenei y o he jou nal publica ions, ega ding discipline and quali y.
Mos pape s ha e been published in Accoun ing and Finance jou nals (70 s udies).
*Some s udies include mo e han one dependen /independen a iable
Table 2 (con inued)
Eme ging Ma ke s Finance and T ade: 1
Eu opean Accoun ing Re iew: 2
Global Finance Jou nal: 1
In e na ional Jou nal o Accoun ing: 2
In e na ional Jou nal o Accoun ing and In o ma ion: 1
Jou nal o Accoun ing and Economics: 5
Jou nal o Accoun ing and Public Policy: 2
Jou nal o Accoun ing Resea ch: 2
Jou nal o Accoun ing Li e a u e: 1
Jou nal o Accoun ing, Audi ing and Finance: 3
Jou nal o Business Finance and Accoun ing: 5
Jou nal o Co po a e Finance: 1
Jou nal o Financial C ime: 1
Jou nal o Financial Economics: 1
Jou nal o In e na ional Accoun ing Resea ch: 1
Manage ial Audi ing Jou nal: 3
Paci ic-Basin Finance Jou nal: 3
Re iew o Accoun ing S udies: 1
Re iew o Quan i a i e Finance and Accoun ing: 1
The Accoun ing Re iew: 7
The Jou nal o Finance: 2
Panel D: by independen a iable
To al: 112* G oup le el: 56
Indi idual le el: 30
Fi m le el: 20
Ins i u ional le el: 6
Panel E: by misconduc a iable (dependen
a iable)
To al: 98 Res a emen s: 58
En o cemen ac ions and aud e en s: 40
369
1 3
The link be weenco po a e go e nance andco po a e inancial…
The bes -known publica ion ou le s a e o example, Jou nal o Business E hics
(11 s udies), Con empo a y Accoun ing Resea ch (9 s udies), Jou nal o Accoun -
ing and Economics (5 s udies), Jou nal o Business Finance and Accoun ing (5
s udies), and The Accoun ing Re iew (5 s udies). Panel D s esses a g ea esea ch
ocus on he g oup le el (56 s udies) and indi idual le el (30) o co po a e go -
e nance. Panel E indica es ha inancial es a emen s udies a e mos impo an in
ou li e a u e e iew (50), while en o cemen ac ions and aud e en s a e o lowe
ele ance ye .
3.2 G oup le el
3.2.1 Boa d composi ion
Boa d independence P io esea ch esul s s essed a he e ogeneous ela ionship
be ween boa d independence and inancial misconduc om an in e na ional pe -
spec i e. Some esea che s ound a nega i e ela ionship be ween boa d independ-
ence and es a emen s (Babe e al. 2012), en o cemen ac ions (Romano and Gue -
ini 2012), and aud (Razali and A shad 2014; Khou i and Khou i 2018). Ve ies
e al. (2013) s a ed a posi i e impac o boa d independence on es a emen s, elying
on a Eu opean se ing. Howe e , mos included s udies in his li e a u e e iew did
no epo any signi ican impac on es a emen s (Hasnan e al. 2020), en o cemen
ac ions (Gha oo e al. 2019; Hasnan e al. 2013; Inya e al. 2018; Yang e al. 2017)
and aud e en s (Shan e al. 2013; Tan e al. 2017).
Boa d expe ise Resea ch on boa d expe ise is linked wi h he e ogenei y o
included p oxies. Manage ial abili y (Deme jian e al. 2013), execu i e skills (Rubin
and Segal 2019), o eign independen di ec o s (Du e al. 2017), academic expe i-
ence o execu i es (Ma e al. 2019) a e nega i ely ela ed o es a emen s. Ma e al.
(2019) also s essed a mode a o e ec o ine icien ex e nal moni o ing on ha
link. Inya e  al. (2018) documen ed a nega i e in luence o independen di ec o s
wi h mo e expe ience and longe enu e on en o cemen ac ions. Mo eo e , based on
a Canadian sample, independen di ec o s who eside close o a i m’s headqua e
educe he p obabili y o es a emen s, bu US di ec o s inc ease i . Acco ding o
Du e al. (2017), he nega i e link is only exis en in non-s a e owned i ms. Razali
and A shad (2014) documen ed ha in e na ional boa d expe ience dec eases aud
isk. Xiang and Zhou (2020) ound ha academic independen di ec o s dec ease
commission o aud and inc ease aud de ec ion, mode a ed by accoun ing and
legal backg ound o he boa d membe s. We also no e con a y esea ch esul s, as
boa d expe ience and expe ise may lead o inc eased inancial misconduc . Back-
g ound homogenei y o execu i es (Zhang 2017) and boa d unc ioning (Ve ies
e al. 2013) a e linked wi h inc eased es a emen s. Fo eign independen di ec o s
(Masulis e al. 2012) a e connec ed wi h highe es a emen s due o i egula i ies,
bu no wi h o he es a emen s. Mo eo e , he e a e indica ions ha ounde s on
he boa d (Hasnan e al. 2013) and malays di ec o on he boa d (Nasi e al. 2019)
inc ease en o cemen ac ions. Few s udies concen a e on boa d gende di e si y
and epo ed a nega i e impac on es a emen s (Wahid 2019), en o cemen ac ions
370
P.Vel e
1 3
(Gha oo e al. 2019), and aud e en s (Capezio and Ma isakalyan 2016; Cumming
e al., 2015; Ma zuki e al. 2019). In his con ex , Wahid (2019) included boa d con-
nec ions as a media o and ound signi ican esul s.
Boa d ne wo ks In line wi h boa d expe ise, we no e a a ie y o boa d ne -
wo k a iables in his li e a u e e iew. Boa d in e locks o miss a ing i ms (Ome
e  al. 2020), and poli ical connec ions o Republican candida es (No bohm 2019)
a e ela ed o dec eased es a emen s. Acco ding o Kuang and Lee (2017), ex e -
nal social connec edness o independen di ec o s is ela ed o ewe aud de ec ion
gi en occu ence o aud, bu no o aud exis ence. Co eia (2014) ound a nega-
i e impac o poli ical connec ions o execu i es h ough con ibu ions and lobby-
ing on en o cemen ac ions. The au ho included he ollowing mode a o a iables
and documen ed a signi ican e ec : ecipien s as he high- anking membe s o he
commi ees wi h he highes con ol o e he SEC and long- e m epea ed ela ion-
ship wi h he i m, lobbying i ms wi h connec ions o he SEC o di ec lobbying.
Kong e  al. (2019) also s essed ha poli ically connec ed independen di ec o s
wi h local, cen al o bo h backg ounds a e ela ed wi h ewe en o cemen ac ions.
In con as o hese esul s, boa d in e locks (Jiang and Zhao 2020) also inc ease
en o cemen ac i i ies. Mo eo e , we no e some insigni ican links be ween poli ical
connec ions and en o cemen ac ions (Gha oo e al. 2019; Hasnan e al. 2013), and
be ween mul iple di ec o ships and es a emen s (Hasnan e al. 2020).
Boa d size Khou i and Khou i (2018) ep esen s he only s udy wi h a nega i e
impac o boa d size on aud e en s. O he included s udies did no ind any signi i-
can in luence o boa d size on es a emen s (Hasnan e al. 2020), en o cemen ac i -
i ies (Romano and Gue ini 2012), and aud (Razali and A shad 2014; Salleh and
O hman 2016; Shan e al. 2013; Tan e al. 2017). This is in line wi h p io esea ch
on boa d size on o he dependen a iables, e.g., i m pe o mance, s essing he he -
e ogeneous cha ac e o his co po a e go e nance p oxy.
Boa d mee ing equency We no e jus wo s udies on he link be ween boa d
mee ing equency and inancial misconduc . While Salleh and O hman (2016)
s essed a dec eased amoun o aud e en s, Shan e al. (2013) epo ed an opposi e
link.
Boa d age Xu e  al. (2018) concen a ed on boa d age and ound a nega i e
impac on en o cemen ac ions in China. This link was weakened by CEO-boa d
di ec ional age di e ence as mode a ing a iable.
3.2.2 Audi commi ees
Audi commi ee independence Few s udies ha e included independence o audi
commi ee membe s in hei esea ch design. Two pape s indica ed a nega i e impac
o independen membe s on es a emen s (La y and Taylo 2012), and en o cemen
ac i i ies (Romano and Gue ini 2012). Ano he wo s udies could no ind any sig-
ni ican impac on aud (Khou i and Khou i 2018; Ma zuki e al. 2019). Tan and
Young (2015) compa ed “li le ” es a emen s and big ones and ound ha boa d
independence leads o mo e li le inancial es a emen s.
Audi commi ee expe ise Mos included s udies on audi commi ees ely on
he expe ise o i s membe s, especially on accoun ing o inancial expe ise. Das
371
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The link be weenco po a e go e nance andco po a e inancial…
e al. (2020) ound a nega i e link be ween accoun ing expe ise on he audi com-
mi ee and es a emen s. Cohen e al. (2014) documen ed ha he combina ion o
accoun ing and indus y expe ise leads o lowe es a emen s in compa ison o
single accoun ing expe ise on he audi commi ee. La y and Taylo (2012) also
ound a nega i e impac o combined inancial and indus y expe ise on es a e-
men s. Financial expe ise (Khou i and Khou i 2018) and audi commi ee e ec i e-
ness (Razali and A shad 2014) a e also ela ed o ewe aud e en s. In con as
o his, Alb ech e al. (2018) s essed an inc eased in luence o accoun ing expe -
ise on es a emen s, mode a ed by excess compensa ion and ea nings managemen .
Acco ding o Lisic e al. (2019), he posi i e link be ween accoun ing expe ise and
es a emen s is mode a ed by ad e se in e nal con ol audi opinions. Ve ies e al.
(2013) documen ed a posi i e impac o audi commi ee e ec i eness on es a e-
men s. Howe e , p io s udies also s essed insigni ican ela ionships be ween
inancial expe ise and es a emen s (Hasnan e  al. 2020), inancial expe ise and
aud (Ma zuki e al. 2019), independen inancial expe s and en o cemen ac ions
(Inya e al. 2018), and supe iso y expe ise and es a emen s (Cohen e al. 2014).
In con as o he a o emen ioned s udies, Ash a e al. (2020), in a ecen s udy, ana-
lyzed he impac o digi al expe ise on he audi commi ee on ma e ial es a emen s
and ound a nega i e ela ionship. In iew o he g ea challenges o digi al ans-
o ma ion and hei huge impac on accoun ing p ac ice, his kind o expe ise will
be mainly ele an in he u u e. Wi h ega d o gende di e si y, O adi and Izadi
(2020) documen ed a nega i e impac on es a emen s, mode a ed by independen
emale inancial expe s on he audi commi ee. Analyzing audi commi ee cul-
u al di e si y, Felix e al. (2021) ound a nega i e impac on es a emen s. This link
was mo e p onounced by i ms ope a ing in complex en i onmen s and CEO powe .
Pa hak e al. (2021) sepa a ed be ween ela ions- and ask-o ien ed on he one hand
and be ween aud- ela ed and e o - ela ed es a emen s on he o he hand. Rela-
ions-o ien ed di e si y leads o lowe aud- ela ed es a emen s while ask-o ien ed
di e si y and e o - ela ed es a emen s a e nega i ely ela ed.
Audi commi ee ne wo ks In line wi h included s udies on he boa d ne wo k, we
iden i y some esea che s who concen a ed on audi commi ee ne wo ks. Audi
commi ee membe s who a e connec ed wi h i ms ha disclosed a es a emen
wi hin he p io h ee yea s o wi h ma e ial in e nal con ol weaknesses cause lowe
es a emen s (Cheng e al. 2019). Simila links can be s a ed o audi commi ee
connec edness h ough di ec o ne wo ks (Ome e al. 2020). In con as o his, co-
op ed audi commi ees (Cassell e al. 2018) and independen audi commi ee mul-
iple-di ec o ships (Sha ma and Iselin 2012, based on pos SOX-pe iods) a e con-
nec ed wi h inc eased es a emen s.
Audi commi ee size, enu e and mee ing equency Gao and Huang (2018) ana-
lyzed audi commi ees wi h an odd numbe o di ec o s and ound ha he nega i e
e ec on es a emen s was mode a ed by audi commi ee membe s wi h he e ogene-
ous op ions, less equi y owne ship, smalle size, and en enched managemen . Wi h
ega d o enu e-di e se audi commi ees, Li and Wahid (2018) also documen ed
a nega i e impac on es a emen s. Howe e , audi commi ee diligence (La y and
Taylo 2012) and mee ing equency (Ma zuki e  al. 2019) we e no ela ed o
es a emen s and aud. Jia e al. (2009) analyzed he Chinese wo- ie sys em and
372
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1 3
ound a posi i e impac o supe iso y boa d size and mee ings on en o cemen
ac ions.
Audi commi ee p esence Audi commi ee p esence (Yang e al. 2017; Romano
and Gue ini 2012) did no in luence en o cemen ac ions.
3.2.3 In e nal audi unc ion
In line wi h he audi commi ee, he in e nal audi unc ion ep esen s a key moni-
o ing ins i u ion wi hin he i m in o de o p e en i ms’ inancial misconduc . Ege
(2015) ound ha he quali y o he in e nal audi unc ion dec eases aud o o he
in en ional misconduc ac ions. Mo eo e , Zeng e al. (2021) documen ed ha in e -
nal audi execu i e’s supe iso y abili y leads o lowe aud.
3.2.4 Boa d compensa ion
Two s udies epo ed a nega i e link be ween execu i e compensa ion (Hasnan
and Hussain 2020), pay dispa i ies (Zhang e  al. 2018), and es a emen s. Zhang
e  al. (2018) also s essed a mode a o e ec o s a e owne ship, CEO u no e ,
and in e nal incoming CEOs. A ms ong e al. (2013) epo ed ha ‘ ega’ is posi-
i ely ela ed o bo h es a emen s and en o cemen ac ions. Acco ding o Hass
e al. (2016), manage s’ pay o pe o mance sensi i i y om s ockholdings inc ease
en o cemen ac ions. Howe e , some esea che s indica ed an insigni ican impac o
boa d compensa ion on inancial misconduc , based on manage ial owne ship (Tan
e al. 2017), and s ock owne ship by supe iso y boa ds (Yang e al. 2017). Few
s udies also included clawback p o isions as ecen oppo uni y o incen i e-based
managemen compensa ion sys ems. Fi m-ini ia ed clawback p o isions (Chan e al.
2012; Fung e al. 2015), and clawback p o ision s eng h (E kens e al. 2018) educe
es a emen s and aud e en s. Fung e al. (2015) also epo ed ha he nega i e link
was weakened by inside sales.
3.3 Indi idual le el
3.3.1 CEO/CFO expe ise
In line wi h boa d (audi commi ee) composi ion and boa d compensa ion, an
inc eased numbe o s udies included indi idual cha ac e is ics o op managemen
eam membe s wi h a clea ocus on he CEO. CEO expe ise ep esen s one o he
mos impo an co po a e go e nance a iables in his con ex wi h a ious indi-
idual p oxies. CEOs as ex-mili a y membe s lead o lowe en o cemen ac ions,
mode a ed by CEO non-duali y model and boa d independence (Koch-Bay am and
We nicke 2018). Huang e al. (2012) also ound ha CEO age educes en o cemen
ac ions. In con as o his, some esea che s s essed a posi i e impac o execu i e
expe ise on i m’s inancial misconduc . CEO enu e inc eases misconduc , weak-
ened by la ge and independen boa ds (Al unbas e al. 2018). CEO and CFO ou side

373
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The link be weenco po a e go e nance andco po a e inancial…
di ec o ships and ne wo k ies o audi o s lead o highe es a emen s, mode a ed by
ne wo k on he local le el (Yu e al. 2020). Two s udies also ound a nega i e impac
o CFO gende on aud e en s in China (Liao e al. 2019; Luo e al. 2020). In mo e
de ail, Liao e al. (2019) s a ed ha his link is mode a ed by gende mixed boa ds
and less powe ul CEO and CFO di ec o ships. Acco ding o Luo e al. (2020), he
link was mode a ed by he le el o educa ion and ex e nal job oppo uni ies.
3.3.2 CEO/CFO ne wo ks
Wu e al. (2016) epo ed ha CEO and/o chai man poli ical connec ions a e linked
wi h lowe es a emen s. This connec ion was mo e p onounced in non-s a e owned
i ms and weak legal en o cemen en i onmen . Mo eo e , CEO employmen , edu-
ca ion, and o he social ne wo k connec ions also educe es a emen s (Bhanda i
e al. 2018). Beda d e al. (2014) s essed a nega i e impac o CFO inside di ec o -
ship on es a emen s. In con as o his, acco ding o Khanna e al. (2015), CEO
connec ions wi h op ou non-CEO execu i es and di ec o s h ough hei appoin -
men decisions a e linked wi h inc eased es a emen s.
3.3.3 CEO powe andduali y
Two s udies documen ed a posi i e in luence o CEO powe indices on es a e-
men s (Lisic e  al. 2016). Lisic e  al. (2016) also s a ed ha his ela ionship is
mode a ed by in e nal con ol weaknesses. CEO duali y ep esen s one o he mos
impo an p oxies o CEO powe . Some esea che s s essed a posi i e in luence on
aud (Khou i and Khou i 2018) and en o cemen ac ions (Yang e al. 2017). O he
esea che s epo ed an insigni ican impac on en o cemen ac ions (Inya e  al.
2018; Romano and Gue ini 2012) and aud e en s (Salleh and O hman 2016; Shan
e al. 2013; Tan e al. 2017).
3.3.4 CEO/CFO compensa ion
Some s udies s essed a nega i e ela ionship be ween CEO compensa ion and i ms’
misconduc . Conyon and He (2016) epo ed a nega i e in luence o CEO equi y-
based compensa ion on aud. CEO in- he-money- alue also educes es a emen s,
mode a ed by clawback p o isions (Na a ajan and Zheng 2019). He (2015) ound
ha CEO inside deb holdings cause dec eased es a emen s. Zhou e  al. (2018)
s essed ha CEO and CFO (equi y) compensa ion educes en o cemen ac ions,
while his link is weakened by delis ing p essu e o he i m. In con as o hese
s udies, acco ding o Bao e al. (2021), CEO pay a io and es a emen s a e posi-
i ely linked, while CEO powe s eng hens and CEO abili y weakens his ela ion-
ship. Hogan and Jonas (2016) ound ha CEO and CFO equi y p opo ion inc eases
and di e ence in CEO and CFO pay s uc u e dec eases es a emen s. Howe e ,
Gha oo e  al. (2019) epo ed an insigni ican ela ionship be ween CEO equi y
compensa ion and en o cemen ac i i ies.
374
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3.3.5 CEO/CFO hub is, o e con idence andna cissism
MacManus (2018) included CEO hub is a iables and s essed ha sel -impo ance
and accomplishmen inc ease es a emen s. The e a e also indica ions ha bo h CEO
na cissism (Rijsenbild and Commandeu 2013) and CFO na cissism (Ham e  al.
2017) imply mo e misconduc s. Mo eo e , CEO o e con idence inc ease es a e-
men s (P esley and Abbo 2013). Acco ding o Hobson e al. (2012), ocal ma k-
e s o cogni i e dissonance o CEOs du ing ea nings con e ence calls lead o mo e
es a emen s.
3.4 Fi m le el
3.4.1 Owne ship s uc u e
Ins i u ional owne ship and blockholdings Wi h ega d o blockholde s, p io esea ch
did no ind any impac on es a emen s (Babe e  al., 2015) and aud (Tan e  al.
2017). Owne ship concen a ion bo h inc eases (Yang e al. 2017) o dec eases (Inya
e al. 2018) en o cemen ac ions. Dou e al. (2016) analyzed he na u e o blockhold-
e s and s a ed ha hedge unds and en u e capi alis s educe es a emen s. While Inya
e al. (2018) documen ed a nega i e link be ween ins i u ional owne ship and en o ce-
men ac i i ies, Babe e al. (2015) ound insigni ican esul s. Relying on he na u e
o ins i u ional in es o s, dedica ed ins i u ional owne ship inc eases (Shi e al. 2017)
o dec eases (Gha oo e al. 2019) en o cemen ac ions. In con as o mos s udies on
ha esea ch opic, Hedge and Zhou (2019) assumed a non-linea ela ionship in hei
s udy on in es o op imism ega ding i m-speci ic a ibu es. When i m-le el op i-
mism is mode a e, es a emen s inc ease, bu i dec eases by high op imism.
Fo eign owne ship Few esea che s on Asian egimes included o eign owne ship
as an ex e nal co po a e go e nance a iable. Shan e  al. (2013 ound a nega i e
impac on aud e en s. Howe e , also insigni ican e ec s on en o cemen ac ions
do exis (Hasnan e al. 2013; Inya e al. 2018).
Family owne ship Asian s udies also elied on amily owne ship. Hasnan e al.
(2013) s a ed ha amily owne ship leads o ewe en o cemen ac ions, while o he
s udies epo ed insigni ican impac on es a emen s (Sue e al. 2013) and en o ce-
men ac i i ies (Gha oo e al. 2019).
S a e owne ship In line wi h o eign and amily owne ship, he in eg a ion o s a e
owne ship is only ele an in Asian s udies. The e a e indica ions ha s a e owne -
ship educe aud e en s (Shan e al. 2013; Shi e al. 2020). Shi e al. (2020) also
ound ha CEO poli ical backg ound mode a es his ela ionship.
3.4.2 Moni o ing byo he s akeholde s
Few s udies add essed inancial analys s and hei impac on i ms’ inancial miscon-
duc . B adley e al. (2017) ound ha indus y expe ise and moni o ing e ec i e-
ness o inancial analys co e age educe es a emen s. In con as o his, acco ding
o Shi e al. (2017), analys ecommenda ions and en o cemen ac ions a e posi i ely
375
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The link be weenco po a e go e nance andco po a e inancial…
linked. I a o ecas signal indica es a g ea e di e ence be ween analys s’ and audi-
o s’ ea nings expec a ions, es a emen s inc ease (New on 2019). Same di ec ions
can be ound i an analys o ecas signal indica es a g ea e likelihood o income
inc easing ea nings managemen .
Wi h ega d o o he s akeholde g oups, labo union s eng h educes es a e-
men s (B yan 2017). Acco ding o Hopkins (2018), US ci cui cou uling ha
made i easie o public co po a ions o de end agains secu i y class ac ions lead o
inc eased es a emen s. This link was mode a ed by low s ock e u n, ex an e isk o
me i o ious li iga ion and ansien ins i u ional owne ship. While Yang e al. (2017)
s a ed a posi i e link be ween egula o y p essu e and en o cemen ac ions, Zhang
(2018) ound a nega i e impac o public go e nance and en o cemen ac ions. This
ela ionship was s eng hened by non-s a e owne ship, weak legal en i onmen , and
poo local economies, and weakened by CEO age.
3.5 Ins i u ional le el
Ou li e a u e e iew only iden i ies legal en o cemen as pa o he ins i u ional
le el o co po a e go e nance. Mos s udies on cha ac e is ics o en o cemen
ins i u ions elied on he US capi al ma ke and add essed he Public Company
Accoun ing O e sigh Boa d (PCAOB) as audi o o e sigh body. PCAOB Pa II
epo s o annually inspec ed i ms (Johnson e al. 2018), ini ial PCAOB inspec-
ions (Khu ana e  al. 2020), and clien s o annually PCAOB inspec ed i ms
ela i e o clien s o iennially inspec ed i ms (Tanyi and Li 2017) lead o
educed es a emen s. Khu ana e al. (2020) also epo ed ha his ela ionship is
less o Big ou audi s and mo e e ec ed o iennially inspec ed non-big ou
audi i ms. In con as o hese s udies, PCAOB inspec ion epo s o ienni-
ally inspec ed audi o s and es a emen s a e posi i ely ela ed, when inspec ion
epo s a e se iously de icien (Gunny and Zhang 2013). Two s udies also con-
cen a ed on axa ion (Lennox 2016; Li and Ma 2019). Li and Ma (2019) s a ed
ha ax en o cemen e o s educe gene al and ax- ela ed es a emen s. Lennox
(2016) did no ind any impac o PCAOB’s es ic ions on audi o s’ ax se ices
on es a emen s.
3.6 Main esul s
Ou li e a u e e iew indica es ha mos esea ch on co po a e go e nance and i ms’
misconduc add essed he g oup and indi idual le el o co po a e go e nance. The
i m and ins i u ional le el o co po a e go e nance we e o lowe a ac ion ye and
hey mainly elied on owne ship s uc u e end legal en o cemen . We also s ess ha
mode a o analyses and especially media o analyses we e a ely included ye . Mos
empi ical esea ch also neglec non-linea ela ionships be ween co po a e go e n-
ance, es a emen s and o he misconduc a iables. The e a e clea indica ions ha
expe ise on he boa d, on audi commi ees and o he CEO/CFO inc ease inancial
epo ing quali y. In e es ingly, all included s udies on gende di e si y on he boa d,
376
P.Vel e
1 3
audi commi ees and on emale CFOs lead o educed es a emen s, en o cemen
ac ions and aud. While he amoun o s udies on indi idual psychological cha ac e -
is ics o he CEO and CFO is a he low, he e a e indica ions ha CEO hub is, o e -
con idence and na cissism inc ease misconduc . Howe e , mos included esea ch
s eng hs show a he he e ogeneous esul s and aise u u e ques ions abou he eal
impac o co po a e go e nance on i m’s inancial misconduc . We iden i y majo
esea ch gaps and limi a ions o p io s udies which we will ocus in he nex sec ion.
4 Discussion and u u e esea ch ecommenda ions
As he majo i y o ou s udies included in his li e a u e e iew ha e add essed inan-
cial es a emen s and he g oup le el o co po a e go e nance, he e is much oom o
ecommenda ions o u u e esea ch. Fi s , we know ela i ely li le abou he in lu-
ence o co po a e go e nance on di e en kinds o es a emen s and o he kinds o
misconduc . We e e o Sie e s and So ilkani sch (2019a, b), who ecommend o di -
e en ia e be ween se e e (in en ional) and less se e e (unin en ional) es a emen s.
Few esea che s explici ly di e en ia e be ween he na u e o es a emen s, e.g., IT-
ela ed (Ash a e al. 2020) o ax- ela ed es a emen s (Lennox 2016; Li and Ma,
2019). Howe e , he ecogni ion o mul iple misconduc a iables in p io esea ch
models is e y a e (e.g., A ms ong e al. 2013). In iew o he he e ogeneous esul s
o p io esea ch, alidi y o included misconduc p oxies should be inc eased. An
in e es ing ques ion ela es o he de elopmen o aud p obabili y sco es be o e and
a e inancial es a emen s. The ela ionship be ween ea nings quali y and es a e-
men s be o e and a e he es a emen e en s should be u he analyzed. Changes in
he F-sco e (Dechow e al. 2011) and he M-sco e (Beneish 1999) should be included
as mode a o o media o a iables in u u e a chi al esea ch. Res a emen s can be
used as a p oxy o bo h disclosu es o p io epo ing ailu e ( es a emen announce-
men ) and mis epo ing ( es a ed pe iods). Res a emen ype is also di e en ly used in
p io a chi al esea ch (e.g., annual s. qua e ly, se e e s. less se e e). We also no e
ha o he i m’s inancial misconduc p oxies a e a ely used. We know ela i ely
li le abou he ela ionship be ween co po a e go e nance and aud e en s in a chi-
al esea ch. As aud e en s a e mainly lowe in compa ison o es a emen cases,
esea che s ocused on es a emen s and ela ed da abases (Ka po e al. 2017).
Ou me hodological ecommenda ions also ela e o co po a e go e nance- ela ed
de e minan s. While he e is an inc eased amoun o s udies which analyze he impac
o he boa d o di ec o s on i ms’ inancial misconduc , we know e y li le abou
non-sha eholding s akeholde p essu e on i m’s inancial misconduc . In compa ison
o owne ship s uc u e, p io a chi al esea ch on he i m and ins i u ional le el jus
ely on inancial analys s and en o cemen ins i u ions. Howe e , o he s akeholde
g oups also punish illegal inancial epo ing beha io o i ms (e.g., media p essu e).
Cus ome s may call o a boyco o une hical p oduc s and se ices, supplie s and
business pa ne may change o o he i ms, and employees may lea e he aud i ms.
Thus, we like o encou age u u e esea che s o include new inno a i e p oxies, also
ela ed o hand-collec ed da a selec ion, in o de o complemen ou pic u e o ex e -
nal (sus ainable) co po a e go e nance as a powe ul moni o ing mechanism.
383
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
E kens e al. (2018) Jou nal o Accoun ing and
Economics
USA
2007–2013
2021 i ms
G oup le el:
clawback p o ision
s eng h index
Res a emen s (dummy;
audi analy ics)
−
Felix e al. (2021) Accoun ing Ho izons USA
2000–2014
17,283 i m-yea obse a-
ions
G oup le el:
Audi commi ee cul u al
di e si y
Mode a o : i ms ope a -
ing in complex en i on-
men s; CEO powe
Res a emen s (dummy;
audi analy ics)
−
Mode a o : mo e p o-
nounced
Fi oozi e al. (2019) Co po a e Go e nance:
An In e na ional Re iew
Canada
2008–12
1050 i m-yea obse a-
ions
G oup le el:
boa d (audi commi ees)
a io o independen
di ec o s who eside
close o a i m’s head-
qua e s; US di ec o s
Res a emen s (dummy;
audi analy ics)
−
+ (US di ec o s)
Gao and Huang (2018) Jou nal o Accoun ing,
Audi ing and Finance
USA
1998–2010
5384 i m-yea obse a-
ions
G oup le el:
audi commi ees wi h an
odd numbe o di ec o s
(dummy)
Mode a o : audi com-
mi ee membe s wi h
he e ogeneous opinions,
less equi y owne ship,
smalle size, en enched
managemen
Res a emen s (dummy;
audi analy ics)
−
Mode a o : +

384
P.Vel e
1 3
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
Gunny and Zhang (2013) Jou nal o Accoun ing and
Public Policy
USA
2005–2009
527 PCAOB inspec ion
epo s
Ins i u ional le el:
PCAOB inspec ion epo s
o iennially inspec ed
audi o s
Res a emen s (dummy;
audi analy ics)
+ (when epo s a e se i-
ously de icien )
Ham e al. (2017) Jou nal o Accoun ing
Resea ch
USA
n.A
939 i ms
Indi idual le el:
CFO na cissism (signa u-
esize)
Res a emen s (dummy;
audi analy ics)
+
Hasnan and Hussain
(2020)
Jou nal o Financial
C ime
Malaysia
2011–2016
49 es a emen i ms
G oup le el:
boa d size, boa d
independence ( a io),
mul iple di ec o ships
( a io), audi commi -
ee inancial expe ise
(numbe ); execu i e
compensa ion ( o al)
Res a emen s (dummy) −(execu i e compensa ion)
He (2015) Re iew o Accoun ing
S udies
USA
2006–2011
1680 i m-yea obse a-
ions
Indi idual le el:
CEO inside deb holdings
(dummy; a io o CEO
pe sonal le e age o i m
le e age exceeds 1)
Res a emen s (dummy;
audi analy ics)
−
Hegde and Zhou (2019) Jou nal o Business E hics USA
1996–2012
830 i m-yea i egula i-
ies and 4360 i m-yea
e o s
Fi m le el:
he e ogenei y in in es o
op imism ega ding
i m-speci ic a ibu es
(Tobin’s Q, EPS g ow h,
analys buy/sell ecom-
menda ion, buy ecom-
menda ions)
Res a emen s (dummy;
GAO, audi analy ics)
When i m-le el in es o
op imism is mode a e, he
incidence o accoun ing
misconduc inc eases, bu
i dec eases when in es o s
a e highly op imis ic
385
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
Hobson e al. (2012) Jou nal o Accoun ing
Resea ch
USA
2006–2007
1572 con e ence call
obse a ions
Indi idual le el:
ocal ma ke s o cogni i e
dissonance (CEO du ing
ea nings con e ence
calls)
Res a emen s (audi
analy ics)
+
Hogan and Jonas (2016) Accoun ing Ho izons USA
2004–2013
1178 es a emen s
Indi idual le el:
CEO/CFO Pay S uc u e
(equi y p opo ion o
CEO/CFO, di e ence in
pay s uc u e be ween
CEO and CFO)
Res a emen s (audi
analy ics)
+ (equi y p opo ion)
−(di e ence in pay s uc-
u e be ween CEO and
CFO)
Hopkins (2018) Con empo a y Accoun -
ing Resea ch
USA
n.A
3690 plus 13,745 i m-
yea obse a ions
Ins i u ional le el:
U.S. ci cui cou uling
ha made i easie o
public co po a ions
o de end agains secu i y
class ac ions ( i ms
headqua e ed in he
Nin h Ci cui )
mode a o s: low s ock
e u n, ex an e isk o
me i o ious li iga ion,
ansien ins i u ional
owne ship
Res a emen s (audi
analy ics)
+
Mode a o s: +
Huang e al. (2012) Accoun ing Ho izons USA
2005–2008
3413 i ms
Indi idual le el:
CEO age
Res a emen s (audi
analy ics)
−
386
P.Vel e
1 3
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
Johnson e al. (2018) Jou nal o Accoun ing
Li e a u e
USA
2007–2015
5433 clien -yea obse a-
ions
Ins i u ional le el:
PCAOB Pa II Repo s
(annually Inspec ed
Fi ms)
Ma e ial es a emen
(audi analy ics)
−
Khu ana e al. (2020) Con empo a y Accoun -
ing Resea ch
USA
2001–2010
29,337 clien yea s-obse -
a ions
Ins i u ional le el:
ini ial PCAOB inspec ion
Res a emen s (audi
analy ics)
−(less o Big ou audi o s
han o o he s)
(e ec mo e p onounced o
he iennially inspec ed
non big ou i ms)
La y and Taylo (2012) Manage ial Audi ing
Jou nal
Aus alia
2004–2009
180 i m-yea obse a-
ions
G oup le el:
audi commi ee independ-
ence, audi commi ee
inancial and indus y
expe ise, audi commi -
ee diligence (mee ing
equency, size)
Res a emen s (dummy) −(independence, expe ise)
Lennox (2016) The Accoun ing Re iew USA
2002–2009
41,535 i m-yea obse a-
ions
Ins i u ional le el:
PCAOB’s Res ic ions on
Audi o s’ Tax Se ices
Res a emen s (dummy;
audi analy ics)
Tax- ela ed miss a e-
men s (dummy; audi
analy ics)
± (no a ec a e he
es ic ions a e ul illed)
Li and Wahid (2018) Con empo a y Accoun -
ing Resea ch
USA
2000–2012
11,170 i m-yea obse a-
ions
G oup le el:
enu e-di e se audi com-
mi ees
Res a emen s (dummy;
audi analy ics)
−
387
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
Li and Ma (2019) Asia–Paci ic Jou nal o
Accoun ing and Eco-
nomics
China
2000–2013
10,642 i m-yea obse a-
ions
Ins i u ional le el:
Tax en o cemen e o s
(by he ax au ho i y as
ax e enue o egion k
du ing pe iod )
Res a emen s (dummy,
CSMAR)
Tax- ela ed es a emen s
(dummy, CSMAR)
−
−
−(income-inc easing
es a emen s)
Lisic e al. (2019) Con empo a y Accoun -
ing Resea ch
USA
2004–2013
G oup le el:
Audi Commi ee
Accoun ing Expe ise
Mode a o : ad e se in e -
nal con ol audi opinion
Res a emen s (dummy;
audi analy ics)
+ (and mode a o )
Lisic e al. (2016) Con empo a y Accoun -
ing Resea ch
USA
2004–2010
7217 i m-yea obse a-
ions
Indi idual le el:
CEO powe (index)
Mode a o : in e nal con-
ol weaknesses
Res a emen s (dummy;
audi analy ics)
+
Mode a o ; +
Ma e al. (2019) Jou nal o Business
Finance and Accoun ing
China
2008–2013
6486 i m-yea obse a-
ions
G oup le el:
op managemen academic
expe ience (dummy;
acul y membe a a
uni e si y o college
o ha ing engaged
in esea ch wo k in a
esea ch ins i u ion o
associa ion)
Mode a o : ine icien
ex e nal moni o ing
(small audi o , small
analys s co e age)
Res a emen s (dummy;
CSMAR)
−
Mode a o : mo e p o-
nounced
388
P.Vel e
1 3
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
Masulis e al. (2012) Jou nal o Accoun ing and
Economics
USA
1988–2006
9979 i m-yea obse a-
ions
G oup le el:
o eign independen di ec-
o s (dummy)
Res a emen s (dummy;
GAO)
Res a emen s due o
i egula i ies (dummy;
GAO)
±
+
McManus (2018) Jou nal o Business E hics USA
2002–2006
142 i ms
Indi idual le el:
CEO hub is (media
a en ion, sel -impo -
ance, p ide in hei
accomplishmen s, i m
ounde , inancial incen-
i es)
Res a emen s (dummy;
GAO)
+ (sel -impo ance, accom-
plishmen )
Na a ajan and Zheng
(2019)
Jou nal o Accoun ing,
Audi ing and Finance
USA
2000–2007
494 es a ing i ms
Indi idual le el:
CEO in- he-money op ion
alue
Mode a o : clawback
p o ision implemen a-
ion a e SOX
Res a emen s (dummy;
GAO; audi analy ics)
−(by mode a o )
New on (2019) Audi ing: A Jou nal o
P ac ice and Theo y
USA
2005–2012
12,505 i m-yea obse a-
ions
Fi m le el:
o ecas signal indica es
a g ea e di e ence
be ween analys s’ and
audi o s’ ea nings
expec a ions; analys
o ecas signal indica es
a g ea e likelihood o
income inc easing ea n-
ings managemen
Res a emen s (dummy;
audi analy ics)
+

389
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
No bohm (2019) Re iew o Quan i a i e
Finance and Accoun ing
USA
1992–2010
6008 i m-yea obse a-
ions
G oup le el:
Managemen ’s conse a-
i e pe sonal ideology
(poli ical con ibu ions
o Republican candi-
da es)
Res a emen s (dummy;
audi analy ics)
−
Ome e al. (2020) Managemen Science USA
2004–2014
442,754 di ec o s
G oup le el:
audi commi ee connec -
edness h ough di ec o
ne wo ks
boa d in e locks o mis-
s a ing i ms
mode a o : audi commi -
ee connec edness
Res a emen s (dummy;
audi analy ics)
−
Mode a o : audi commi ee
connec edness mode -
a es he nega i e e ec o
boa d in e locks o mis-
s a ing i ms on inancial
epo ing quali y
O adi and Izadi (2020) Manage ial Audi ing
Jou nal
I an
2013–2017
683 i m-yea obse a-
ions
G oup le el:
Audi commi ee gende
di e si y (dummy)
Res a emen s (dummy) −
Mo e p onounced by
independen and inancial
expe emale membe s
Pa hak e al. (2021) Jou nal o Managemen
and Go e nance
USA
1996–2010
G oup le el:
Audi commi eedi e si y
Res a emen s (dummy) − ( ela ions-o ien ed
di e si y and aud- ela ed
es a emen s; ask-o i-
en ed di e si y and e o -
ela ed es a emen s)
390
P.Vel e
1 3
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
P esley and Abbo (2013) Ad ances in Accoun ing USA
2002–2006
75 es a emen i ms
Indi idual le el:
CEO o e con idence
(dummy; CEO holds
ully es ed 67% in- he-
money op ions h ough-
ou he six h yea o he
op ions’ du a ion
Res a emen s (dummy;
GAO)
+
Rubin and Segal (2019) Jou nal o Business
Finance and Accoun ing
USA
2000–2010
94,506 di ec o -yea
obse a ions
G oup le el:
execu i es skills ( i m size
on which he di ec o
se es as an independen
di ec o )
Res a emen s (dummy;
audi analy ics)
−
Sha ma and Iselin (2012) Audi ing: A Jou nal o
P ac ice and Theo y
USA
2001–2007
382 i ms
G oup le el:
independen audi com-
mi ee mul iple-di ec o -
ships, independen audi
commi ee enu e
Res a emen s (dummy;
GAO)
+ (pos SOX)
Sue e al. (2013) Jou nal o Business
Finance and Accoun ing
Taiwan
1996–2006
249 es a emen i ms
Fi m le el:
amily owne ship
(dummy)
Mode a o : con ol-
owne ship di e gence o
con olling sha eholde s,
epu a ion o lacking
in eg i y
Res a emen s (dummy) ±
Bu when accoun ing i eg-
ula i ies a e de ec ed in
he case o amily i ms,
hey a e associa ed wi h
mo e se ious accoun ing
es a emen s
391
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
Tan and Young (2015) Accoun ing Ho izons USA
2009–2012
1062 i m-yea obse a-
ions
G oup le el:
boa d independence
Indi idual le el:
CEO duali y, CEO enu e,
CFO enu e
“li le ” es a emen s
(dummy; SEC; audi
analy ics)
+ (in compa ison o big
es a emen s)
Tanyi and Li (2017) Jou nal o Business
Finance and Accoun ing
USA
2000–2011
24,319 i m-yea obse a-
ions
Ins i u ional le el:
Clien s o annually
PCAOB inspec ed i ms
ela i e o clien s o i-
ennially inspec ed i ms
Res a emen s (dummy;
audi analy ics)
−
Ve ies e al. (2013) Eu opean Accoun ing
Re iew
In e na ional (Eu ope)
2005–2006
223 i ms
G oup le el:
Boa d independence,
boa d unc ioning, audi
commi ee e ec i eness
T anspa ency o IFRS
es a emen index
( es a ed i ems, numbe
o pages, numbe o
yea s, o ma o es a e-
men )
+
Wahid (2019) Jou nal o Business E hics USA
2000–2010
38,273 i m-yea s obse -
a ions
G oup le el:
Boa d Gende Di e si y
(dummy)
Mode a o : go e nance
quali y
Media o : inancial expe -
ise, boa d connec ions
Res a emen s (dummy;
audi analy ics)
Res a emen as i egu-
la i ies (dummy; audi
analy ics)
−
Media o :—(boa d connec-
ions)
392
P.Vel e
1 3
Table 3 (con inued)
Au ho (s)yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable:
es a emen s
Findings
Yu e al. (2020) Eu opean Accoun ing
Re iew
USA
2003–2015
149–420 i ms
Indi idual le el:
CEO/CFO Ou side Di ec-
o ships and ne wo k ies
o audi o s
Mode a o : ne wo k on he
local o ice le el
Res a emen s (dummy;
audi analy ics)
+
Mode a o : +
Zhang (2017) The Accoun ing Re iew USA
2006–2013
2658 i m-yea obse a-
ions
G oup le el:
Execu i e expe iences
(backg ound homogene-
i y, long-sha ed wo king
expe ience)
Res a emen s (dummy;
audi analy ics)
+
Zhang e al. (2018) In e na ional Jou nal o
Accoun ing
China
2008–2015
16,234 i m-yea obse a-
ions
G oup le el:
Tou namen incen i es
(pay dispa i ies)
Mode a o : s a e owne -
ship, CEO u no e ,
in e nal incoming CEO
Co e es a emen s
(dummy; CSMAR)
Non-co e es a emen s
−
Mode a o : mo e p o-
nounced
399
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 4 (con inued)
Au ho (s) yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable Findings
Koch-Bay am and We -
nicke (2018)
S a egic Managemen
Jou nal
USA
1982–2011 (1996–2005)
2926 i m-yea obse a-
ions
Indi idual le el:
Ex-mili a y CEOs
(dummy)
Mode a o : no CEO dual-
i y, boa d independence
En o cemen ac ions
(AAER)
G an da es o CEO’s
s ock op ions ha -
ing been manipula ed
(“lucky g an s”)
−
Mode a o : +
Kong e al. (2019) Accoun ing and Finance China
2000–2014
17,057 i m-yea obse a-
ions
G oup le el:
Poli ically connec ed
independen di ec o s
(local, cen al and bo h
backg ounds)
En o cemen ac ions
(CSMAR)
−
Kuang e al. (2017) Jou nal o Co po a e
Finance
USA
1999–2013
17,688 i m-yea s obse -
a ions
G oup le el:
ex e nal social connec -
edness o independen
di ec o s
Independen di ec o s’
connec ions o aud
i ms
F aud e en s (dummy;
AAER and S an o d
Law School Secu i ies
Class Ac ion Clea ing-
house)
F aud de ec ion
± (commission)
−( aud de ec ion gi en
occu ence o a aud)
+ ( aud commission;
de ec ion)
Liao e al. (2019) Paci ic-Basin Finance
Jou nal
China
2003–2015
10,073 i m-yea obse a-
ions
Indi idual le el:
Female CFO (dummy)
Mode a o : s a e owne -
ship, gende -mixed
boa ds, CEO powe ,
CFO di ec o ship in he
same i m
F aud e en s (dummy;
CSMAR)
−
Mode a o : weakened (s a e
owne ship), + (gende
mixed boa ds), + (less
powe ul CEO and CFO
di ec o ship)

400
P.Vel e
1 3
Table 4 (con inued)
Au ho (s) yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable Findings
Luo e al. (2020) Paci ic-Basin Finance
Jou nal
China
2004–2014
14,536 i m-yea obse a-
ions
Indi idual le el:
Female CFO
Mode a o : le el o
educa ion, ex e nal job
oppo uni ies
F aud e en s (dummy;
CSMAR)
−
Mode a o : +
Ma zuki e al. (2019) Asian Academy o Man-
agemen Jou nal
Malaysia
2002–2014
64 i ms
G oup le el:
audi commi ee independ-
ence, g ey audi com-
mi ee membe s, audi
commi ee inancial
expe ise, audi com-
mi ee mee ings, boa d
gende di e si y
F aud e en s (dummy;
Secu i ies Commission)
−(gende di e si y)
Nasi e al. (2019) Accoun ing Resea ch
Jou nal
Malaysia
2001–2008
76 aud i ms
G oup le el:
Malays di ec o on he
boa d ( a io)
En o cemen ac ions
(dummy; SCM)
+
Razali and A shad (2014) P ocedia Malaysia
2010–2011
227 i ms
G oup le el:
boa d size, in e na ional
expe ience, audi com-
mi ee e ec i eness,
independen non-execu-
i e di ec o s)
F aud isk (in eg a ion o
Beneish M-Soc e model
and Al man’s Z-sco e)
−(in e na ional expe i-
ence, audi commi ee
e ec i eness, independen
non-execu i e di ec o s)
Rijsenbild and Comman-
deu (2013)
Jou nal o Business E hics USA
1992–2008
113 aud i ms
Indi idual le el:
CEO na cissism (sco e by
15 a iables)
En o cemen ac ions
(dummy; AAER)
+
401
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 4 (con inued)
Au ho (s) yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable Findings
Romano and Gue ini
(2012)
Manage ial Audi ing
Jou nal
I aly
2002–2010
n.A
G oup le el:
boa d size, boa d inde-
pendence, p esence o
an audi commi ee and
composi ion, p esence
o nomina ion and emu-
ne a ion commi ee
Indi idual le el:
CEO duali y
En o cemen ac ions
(dummy)
−(boa d independence;
audi commi ee inde-
pendence)
Salleh and O hman (2016) P ocedia Economics and
Finance
Malaysia
2000–2010
99 i ms
G oup le el:
boa d size, mee ing
equency
Indi idual le el:
CEO duali y
F aud e en s (dummy) −(mee ing equency)
Shan e al. (2013) Sou h Eas Asia Resea ch Malaysia
2007–2009
579 i m-yea obse a-
ions
G oup le el:
mee ing equency, boa d
independence, boa d
size
Indi idual le el:
CEO duali y
Fi m le el:
s a e owne ship, o eign
owne ship
F aud e en s (dummy;
SEC)
+ (mee ing equency)
-(s a e owne ship; o eign
owne ship)
402
P.Vel e
1 3
Table 4 (con inued)
Au ho (s) yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable Findings
Shi e al. (2017) S a egic Managemen
Jou nal
USA
1999–2012
Fi m le el:
dedica ed ins i u ional
in es o s, numbe o
i m’s akeo e de ense
p o isions, secu i ies
analys s ecommenda-
ions
En o cemen ac ions
(dummy; AAER) (com-
mi men and de ec ion)
+ (dedica ed ins i u ional
in es o s)
−( akeo e de ense p o i-
sions)
+ (analys s ecommenda-
ions)
Shi e al. (2020) Co po a e Go e nance China
2003–2012
2246 i ms
Fi m le el:
s a e owne ship (dummy)
Mode a o : CEO poli ical
backg ound (dummy)
Secu i ies aud e en s
(dummy)
−
Mode a o : mo e p o-
nounced
Tan e al. (2017) Accoun ing and Finance Aus alia
2000–2007
n.A
G oup le el:
nonexecu i e di ec o s,
boa d size, manage ial
owne ship
Indi idual le el:
CEO duali y
Fi m le el:
blockholde s
Sel - epo ed aud e en s
(KPMG F aud su ey)
En o cemen ac ions
±
403
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 4 (con inued)
Au ho (s) yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable Findings
Wang and Wu (2011) The Jou nal o Finance USA
1996–2007
110 IPO aud cases
Fi m le el:
Ins i u ional in es o
belie s abou indus y
business condi ions
(analys o ecas s,
book-building pe iod,
Tobin’s Q)
mode a o : moni o -
ing cos s o in es-
o s ( en u e capi al
special y sco e, backed
by en u ecapi ali s),
unde w i e moni o -
ing cos s, manage ial
compensa ion (sho and
long e m)
IFO en o cemen ac ions
(dummy; AAER and
secu i ies class ac ion
lawsui s)
F aud p opensi y inc eases
wi h he le el o
in es o belie s abou
indus y p ospec s bu
dec eases when belie s
a e ex emely high (non
linea )
Wu e al. (2016) Jou nal o Business E hics China
2003–2011
966 en o cemen
announcemen s
Indi idual le el:
poli ical connec ed
CEO and/o chai man
(dummy)
Fi m le el:
ins i u ional in es o s
( a io)
Mode a o : s a e owne -
ship, legal en i onmen
En o cemen ac ions
(dummy; CSMAR)
−
Mode a o : mo e p o-
nounced by non-s a e-
owned i ms and weak
legal en i onmen
(poli ical connec ions);
by s a e-owned i ms and
weak legal en i onmen
(ins i u ional in es o s)
404
P.Vel e
1 3
Table 4 (con inued)
Au ho (s) yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable Findings
Xiang and Zhu (2020) Asia–Paci ic Jou nal o
Accoun ing and Eco-
nomics
China
2007–2017
23,977 i m-yea obse a-
ions
G oup le el:
academic independen
di ec o s ( a io)
Mode a o : legal and
accoun ing backg ound,
high epu a ion
F aud e en s (dummy;
RERSSET da abase)
F aud de ec ion
−(commission); + (de ec-
ion)
Mode a o : + (accoun ing/
legal backg ound)
Xu e al. (2018) Long Range Planning China
2010–2013
1264 i m-yea obse a-
ions
G oup le el:
boa d age
Mode a o : CEO-boa d
di ec ional age di e -
ence
En o cemen ac ions
(dummy; CSMAR)
−
Mode a o : weakned
Yang e al. (2017) Technological Fo ecas ing
and Social Change
China
1996–2007
82 aud cases
G oup le el:
boa d independence, audi
commi ee p esence,
s ock owne ship by
supe iso y boa ds
Fi m le el:
owne ship concen a ion,
egula ion p essu e, s a e
owne ship
Indi idual le el:
CEO duali y
En o cemen ac ions
(dummy; CSMAR)
+ (less owne ship con-
cen a ion, CEO duali y,
egula ion p essu e)
Zeng e al. (2021) In e na ional Jou nal o
Accoun ing and In o -
ma ion
China
2010–2017
922 i ms
G oup le el:
In e nal audi execu i e’s
supe iso y abili y
F aud (e en s dummy;
CSMAR)
−

405
1 3
The link be weenco po a e go e nance andco po a e inancial…
Table 4 (con inued)
Au ho (s) yea Jou nal Sample Co po a e go e nance
measu e(s) as independen
a iable(s)
Dependen a iable Findings
Zhang (2018) Jou nal o Business E hics China
2004–2014
Fi m le el:
public go e nance
Mode a o : non-s a e
owne ship, weak legal
en i onmen , poo local
economies, CEO age
En o cemen ac ions
(dummy; CSMAR)
−
Mode a o : mo e p o-
nounced, bu weakened by
CEO age
Zhou e al. (2018) Paci ic-Basin Finance
Jou nal
China
2007–2014
11,865 i m-yea obse a-
ions
Indi idual le el:
CEO/CFO compensa ion
(wi h o wi hou equi y
incen i es)
Mode a o : delis ing
p essu e
En o cemen ac ions
(dummy; CSMAR)
−
Mode a o : weakened
406
P.Vel e
1 3
Au ho s’ con ibu ions Single au ho .
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