Research On The Influence Of CEO Tenure On Real Earnings Management Of Listed Companies In China

Recently, with the rapid development of capital market, the scale of security market is increasing and the market competition is growing. As the center of enterprise power, CEO has a significant influence on enterprise. CEO tenure, as one of the characteristics of executives, is vital to the sound development of enterprise. To CEO himself, the length of CEO tenure can influence his management behavior. Meanwhile, CEO's management behavior can also influence CEO's salary, reputation and so on. At the different stages of tenure, based on different motivations, CEO will use different ways to manipulate the earnings of enterprises, which may influence enterprises' accounting information quality and stakeholder's interest. For this reason, the relationship between CEO's personal characteristics and real earnings management gained an extensive attention by academic field.At the basis of existing research, the article combined with the professional concern and reputation mechanism, CEO five stage model, information asymmetry theory and upper echelons theory to analyze and exam the relationship between CEO tenure and real earnings management. The paper select 7231 A shares listed companies which first listed in Shanghai and Shenzhen during 2007 to 2013 as a sample and regard it as research objective. Meanwhile, this paper use the CEO tenure data collected from CSMAR as independent variable, and regard the real earnings management comprehensive index and real earnings management manipulate means as dependent variable. On this basis, the paper add some corporate governance index and financial indicators as control variables and construct 2 study models to research the CEO tenure's impact on real earnings management from the perspective of CEO personal characteristics.The study found that the relationship between CEO tenure and real earnings management reflecting as U-shaped curve and with the tenure increase, the relationship form between CEO tenure and real earnings management become more pronounced in the companies with younger CEO, better business performance, dual CEO and private-controlled companies. Furthermore, there is a significant positive correlation between CEO's predicted tenure and real earnings management.The paper studied CEO tenure and CEO predicted tenure's impact on real earnings management. Moreover, based on the direct relationship between CEO tenure and real earnings management, the paper also studied whether the age of CEO, CEO duality, the performance of company and the property of company plays a significant effect on the relationship between CEO tenure and real earnings management obviously. Based on the empirical results, the paper put forward some suggestions from three aspects: perfect the policy of CEO employment, strengthen the supervision of CEO and optimize the equity structure of listed company, to restrain the earnings management behavior and improve the earnings quality of listed company.