Publication Type

Journal Article

Version

publishedVersion

Publication Date

6-2022

Abstract

We examine the relationship between active independent directors and earnings quality for U.S. firms. We construct measures that proxy for activeness of independent directors and find that the proportion of active independent directors is under half on average. Our finding shows that earnings quality increases with the percentage of active independent directors on the board. Once the active independent directors are separated out, the other independent directors do not have any effect on earnings quality. This finding supports the hypothesis that the activeness of independent directors is incrementally significant over just the proportion of independent directors for the quality of reported earnings.

Keywords

Active independent directors, earnings quality, corporate governance

Discipline

Accounting | Corporate Finance

Research Areas

Corporate Reporting and Disclosure

Publication

Theoretical Economics Letters

Volume

12

Issue

3

First Page

897

Last Page

915

ISSN

2162-2078

Identifier

10.4236/tel.2022.123048

Publisher

Scientific Research Publishing

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.4236/tel.2022.123048

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