Board Quality and Earnings Management Evidence from India

May 19, 2026

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This article investigates whether board quality shapes firms’ earnings management in a large emerging-market setting, using panel data from 783 Indian private manufacturing companies across a seven-year period (April 2009–March 2016). Findings show that board quality curbs earnings manipulation beyond the effect of board independence. Diligent, active boards reduce earnings management; CEO duality affects the quality of reported earnings; and promoter influence increases earnings management. Institutional investors show no independent impact, while domestic institutional ownership reduces earnings management when promoters influence exists.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages23

Reading Time58 min

Introduction

Earnings management motives and information effects

Corporate governance and monitoring mechanisms

Abstract Findings and implications

FAQs

What dataset and time span does the study use to analyze earnings management?

The study uses panel data of 783 Indian private manufacturing firms over seven years, from April 2009 to March 2016.

How does board quality affect earnings management according to the study?

Board quality helps curb earnings manipulation, and the effect is not limited to board independence.

What roles do CEO duality and promoter influence play in earnings management outcomes?

CEO duality affects the quality of reported earnings, while promoters’ influence on boards increases earnings management.

May 19, 2026

Upload by Violet