With growing economic globalization, returnee managers who have obtained education or work experience overseas play a much more crucial role in corporations, especially in emerging economies. Using hand-collected managerial background data from a sample of firms listed on the Shanghai and Shenzhen Stock Exchanges from 2010 to 2014, this paper investigates the impact of returnee managers on corporate social responsibility (CSR) performance. We find that returnee managers can promote CSR performance. Further analyses show that the impact of returnee managers on CSR is more pronounced when managers have a foreign study background compared to managers with foreign work experience. The impact only holds when managers obtained their experience in developed economies. When enterprises face greater information asymmetry, returnee managers are more willing to use CSR as a tool to convey a positive image to stakeholders. CSR can help managers reduce information asymmetry and improve firm value. The results are robust through a series of robustness checks including a propensity score matching (PSM) procedure and a Heckman two-state sample selection model. This paper contributes to growing studies on the economic consequences of returnee managers and advances our understanding of the determinants of CSR at the individual level. The results also have implications for government and enterprises attracting talents with overseas experience.
In this study, we investigate whether individual auditors are associated with the comparability of their clients' financial statements, based on a sample of Chinese companies audited by 10 large audit firms. We demonstrate that individual auditors have an incremental effect on comparability, beyond the office-level effect. We also find that the style of individual auditors is stronger when they are affiliated with Big 4 audit firms (compared to non-Big 4 large audit firms) and when they are industry experts. In addition, two possible channels of enhanced comparability are identified: (i) client's accounting flexibility, which provides opportunities; and (ii) individual auditors' characteristics such as age, position, and academic degree, which affect auditors' abilities to exert influence. Our results are robust to alternative comparability and industry specialist measures, to various sampling methods, and to corrections for potential endogeneity problems.
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