Earnings quality, foreign investor and dividends

This study discovers the relation between corporate governance factors and earnings quality and finds that increases in dividends and foreign ownership deter earnings management. The author shows that dividend increases and foreign ownership enhance earnings quality, but they appear to be substitute...

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Bibliographic Details
Published in선물연구 Vol. 30; no. 1; pp. 58 - 72
Main Author Jong Hwa Lee
Format Journal Article
LanguageKorean
Published 한국파생상품학회 31.03.2022
Subjects
Dividends
Earnings management
Earnings quality
Foreign investor
Monitoring effect
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Summary:This study discovers the relation between corporate governance factors and earnings quality and finds that increases in dividends and foreign ownership deter earnings management. The author shows that dividend increases and foreign ownership enhance earnings quality, but they appear to be substitutes in that role. In other words, as foreign ownership increases, the influence of dividends in increasing earnings quality decreases. Improving transparency through dividend increases and monitoring by foreign institutional investors are substitutes in preventing earnings management.
Bibliography:Korea Derivatives Association
ISSN:1229-988X
DOI:10.1108/JDQS-07-2021-0018