The dark tetrad of personality and the accounting information quality: the moderating effect of corporate reputation

Abstract

Góis, A. D. (2017). The dark tetrad of personality and the accounting information quality: The moderating effect of corporate reputation. Doctoral Dissertation, Faculty of Economics, Administration and Accounting (FEA), University of São Paulo (USP). The Upper Echelons Theory states that CEO characteristics, among them the Dark Tetrad (narcissism, Machiavellianism, psychopathy, and sadism) of personality, affect decisionmaking. In an accounting context, the presence of the Dark Tetrad of personality in CEOs can reduce accounting information quality because the personalities of the Dark Tetrad are associated with callousness, impulsivity, manipulation, criminality, grandiosity, enjoyment of cruelty, and misconduct, therefore CEOs with these traits are likely to manipulate earnings or commit fraud. However, companies with strong reputation due to the credibility and trustworthiness built into the company values and culture can reduce the effect of dark personality in accounting information quality. In such context, this study aims to investigate the moderating effect of corporate reputation on the relationship between the Dark Tetrad of personality and accounting information quality. The main assumption is that CEOs with strong Dark Tetrad traits engage more in earnings management and fraud; however, in companies with strong reputation, earnings management and fraud would be lower due to the values, structures, and formal or informal rules built around corporate reputation. This implies that companies with strong reputation tend to suppress the opportunistic actions of CEOs, enabling better accounting information quality. The research design was divided into two parts: the first part involved an archival method and the second part used an experiment method. For the archival method, I analyzed 434 firms (2,645 observations) with headquarters in the United States, covering the period between 2010 and 2017, using abnormal accruals, real earnings management, and classification shifting for earnings management, the overall Fortune's World's Most Admired Companies score for reputation, CEO speeches, and dark personality literature to measure the Dark Tetrad of personality. I ran regressions to test the research hypotheses and found that the Dark Tetrad of personality shows a positive relationship with all types of earnings management. Regarding reputation, only abnormal accruals show a negative relationship with corporate reputation. In turn, the interaction between the Dark Tetrad of personality and corporate reputation is negatively related to all types of earnings management. For the experimental method, I used a 2x2 between-subjects experiment design involving 101 MBA students who, in general, have had experience in management in Brazil and the United States of America. To measure the Dark Tetrad of personality, I used the Short-Dark Triad (Jones & Paulhus, 2014) and the Assessment of Sadistic Personality (Plouffe et al., 2017). For reputation, I adapted the scenarios from Goldberg and Hartwick (1990) and Lafferty (2...

Responsabilidade Social Corporativa Modera a Relação Entre O Traço Maquiavélico E O Gerenciamento De Resultados?

“…Este achado é proporcionalmente inferior ao encontrado por Silva (2019), (x=2,55814), e D'Souza (2016), (x=2,9155), quando as autoras pesquisaram gestores brasileiros, utilizando a escala de (1 a 5) pontos na escala Likert. Góis (2017) também verificou a média para o Maquiavelismo de (x=4,42) para estudantes de MBA brasileiros e (x=4,6) para norteamericanos, em uma escala de (1 a 10). Em se tratando das variáveis de controle, o gênero se diferenciou na presença da RSC.…”

“…Esse resultado não valida a hipótese H4 e diverge dos achados de Góis (2017), que constatou que a reputação corporativa modera e inibe a relação entre o Maquiavelismo e fraude. E Silva (2019), que também verificou que a moderação da governança corporativa resultou em uma relação negativa entre Maquiavelismo e o GR.…”

“…Estudos no âmbito comportamental sugerem que a prática de manipular resultados é motivada pela personalidade dos indivíduos (Silva, 2019;D'Souza, Lima, Jones, & Carre, 2019;Góis, 2017;D'Souza, 2016;D'Souza & Lima, 2015) porque, como enuncia a teoria do Alto Escalão (Hambrick, 2007;Hambrick & Mason, 1984), as interpretações e escolhas de executivos estão relacionadas às características pessoais, aos valores e à personalidade.…”

“…Busca-se, além da análise separada entre as temáticas, preencher uma lacuna teórica sobre o conhecimento da moderação da RSC na relação entre o Maquiavelismo e o gerenciamento de resultados, haja vista estudos anteriores terem se debruçado a discutir de forma separada a relação em par das temáticas Maquiavelismo e RSC (Shafer & Lucianetti, 2018;Burton & Hegarty, 1999) e Maquiavelismo e gerenciamento de resultados (Hartmann & Maas, 2010;Murphy, 2012;Byngton & Johnson, 2011), ou a análise de outros traços sombrios de personalidade: narcisismo, RSC e gerenciamento (Lin, Sui, Ma, Wang, &Zeng, 2018;Petrenko, Aime, Ridge, & Hill, 2016;Tang, Mack, & Chen, 2018), Dark Tetrad (Narcisismo, Maquiavelismo, Psicopatia e Sadismo), mecanismos de governança corporativa e gerenciamento de resultados (Silva, 2019); e o Dark Tetrad, reputação corporativa e a qualidade da informação contábil (Góis, 2017).…”

Narcissism, risk and uncertainties: analysis in the light of prospect and fuzzy-trace theories

“…Furthermore, studies on decision-making and narcissism that developed empirical applications in a national context have discussed opportunistic decisions, with manipulation or management of results (D’Souza, Lima, Jones, & Carre, 2019; Góis, 2017; D’Souza, 2016; D’Souza & Lima, 2015), analyzing, in addition to the narcissistic trait, other dark personality traits: Machiavellianism, psychopathy and sadism.…”