The Impact of Board Internationalization on Real Earnings Management: Evidence From China

In this article, we examine the impact of board internationalization on real earnings management. Using annual data 2,899 Chinese listed non-financial firms with 16,638 firm-year observations over period from 2008 to 2017 for empirical analysis, find robust evidence that higher proportion foreign directors corporate boards reduces Results support hypothesis increase boards’ effectiveness in monitoring management and, consequently, lead less by executives. Our results are alternative measures internationalization, instrumental variable and adding additional control variables. We further observe more effective reducing local experience provinces developed institutional environment. Moreover, complement accrual activities–based management, is both types Overall, our findings imply improves quality reported outside shareholders.