Gender diversity and earnings management: the case of female directors with financial background

Past evidence generally suggests that the presence of female directors on corporate boards tends to improve earnings quality due to these directors’ superior monitoring abilities. However, it is not clear which characteristics and skills of female directors drive such abilities. In this paper, we focus on the financial background of female directors, an area which remains largely unexplored in existing literature. The results show that the participation of female directors with relevant financial background improves earnings quality more than the participation of female directors without such background. In addition, our findings suggest that only female directors possessing relevant financial background and having fewer outside directorships are able to mitigate earnings management and therefore overcommitting expert female directors with more outside directorships would diminish their monitoring ability. We did not find any evidence suggesting that female directors without relevant financial background are able to mitigate earnings management, irrespective of their outside directorships or tenure. We interpret our findings within a theoretical framework that draws on a number of economic and social theories. The results are generally robust after controlling for potential endogeneity problems

Corporate governance and performance in sports organisations: The case of UK

A considerable amount of accounting, economics and finance studies have investigated the link between corporate governance (CG) and performance in profit and non‐profit organisations. This paper departs from the existing literature by investigating the relationship between CG structures and both financial performance (FP, measured as return on assets (ROA) and equity (ROE)) and non‐financial performance, measured as league points won (NFP‐Points), of sports organisations with specific focus on UK premier leagues' football (soccer) teams. We collect data relating to CG structures, FP and NFP‐Points of football clubs playing in the four UK premier leagues in England, Northern Ireland, Scotland and Wales along with the English Championship teams over the 2011–2016 period. We analyse our data relating to 80 football clubs over a 6‐year period (generating 397 club‐year observations) by running a number of multivariate analyses to test our hypotheses. Our findings are as follows. First, we find that NFP‐Points is higher in clubs with larger boards, non‐executive directors (NED), CEO role duality, and higher percentage of foreign and/or younger directors, but lower in firms with higher percentage of female directors. Second and by contrast, we find that the relationship between these same set of variables and FP is, however, insignificant except for boards with NED that remained significant and negatively related to ROA. Our findings appear to reflect the prioritisation of on‐the‐field performance over off‐the‐field performance by sports organisations. Our evidence is largely robust to using alternative measures and estimation models