Chief financial officer overconfidence and stock price crash risk

Numerous studies have shown the prevalence of overconfidence among Chief Financial Officers (CFOs). Surprisingly, real effect CFO is under-researched. Using data from a large sample US-listed firms over period 1993–2019 and adopting an eclectic theoretical approach, we find that overconfident CFOs are more likely to increase stock price crash risk than non-overconfident through risk-taking bad news hoarding. These findings pass series robustness tests. Furthermore, departing most merely examine one type top managers (i.e., Executive Officer (CEO)), consider influence CEO jointly. Interestingly, outweighs in influencing risk. Moreover, intensified when collaborate with CEOs, thus raising However, stronger governance transparent information environment constrain CFOs' on Overall, our highlight importance determining return tail risks.