CEO narcissism and corporate tax avoidance,
ABSTRACT Narcissism (NARC) in senior executives has a perceptible impact on corporate decision-making and strategies and is often associated with unethical and opportunistic behaviors, including tax avoidance (TA). In this study, we therefore evaluated the association between chief executive officer...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
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Universidade de São Paulo
2020-11-01
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| Series: | Revista Contabilidade & Finanças |
| Subjects: | |
| Online Access: | http://www.scielo.br/scielo.php?script=sci_arttext&pid=S1519-70772021000100080&tlng=en |
| _version_ | 1811275438060732416 |
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| author | Victor Cortez Araújo Alan Diógenes Góis Márcia Martins Mendes De Luca Gerlando Augusto Sampaio Franco de Lima |
| author_facet | Victor Cortez Araújo Alan Diógenes Góis Márcia Martins Mendes De Luca Gerlando Augusto Sampaio Franco de Lima |
| author_sort | Victor Cortez Araújo |
| collection | DOAJ |
| description | ABSTRACT Narcissism (NARC) in senior executives has a perceptible impact on corporate decision-making and strategies and is often associated with unethical and opportunistic behaviors, including tax avoidance (TA). In this study, we therefore evaluated the association between chief executive officer (CEO) NARC and TA in Brazilian public firms. By focusing on Brazil, an emerging economy regulated by code law, our investigation makes an important contribution to the accounting literature on TA. Most studies examining the relation between corporate TA and CEO personality profile have been conducted in common law countries. According to the literature, TA behaviors are influenced by tax system specifics. In addition, the home country’s level of economic development should be taken into account when quantifying corporate TA. These observations, and the lack of previous investigation focusing on Brazil, ratify the relevance of the study. Our study also provides tax authorities, auditors, and investors with tools to identify narcissistic behaviors predictive of corporate TA, which may demand precautionary measures on part of business partners. The sample consisted of 68 Brazilian public firms (382 observations), covering the period 2010-2017, and a robust regression model with panel data was used. TA and NARC were measured with secondary data according to the literature. Our findings show a positive correlation between CEO NARC and TA. Executives with this personality trait come across as bold or aggressive, thus more prone to adopt TA strategies, as confirmed in the present study. The study contributes to the literature by demonstrating how a personality disorder like NARC affects corporate tax policies, with potential damage to corporate reputation. |
| first_indexed | 2024-04-12T23:37:50Z |
| format | Article |
| id | doaj.art-17a0362fdfc74c83ab297a1dfa566e2d |
| institution | Directory Open Access Journal |
| issn | 1808-057X |
| language | English |
| last_indexed | 2024-04-12T23:37:50Z |
| publishDate | 2020-11-01 |
| publisher | Universidade de São Paulo |
| record_format | Article |
| series | Revista Contabilidade & Finanças |
| spelling | doaj.art-17a0362fdfc74c83ab297a1dfa566e2d2022-12-22T03:12:04ZengUniversidade de São PauloRevista Contabilidade & Finanças1808-057X2020-11-013285809410.1590/1808-057x202009800CEO narcissism and corporate tax avoidance,Victor Cortez Araújohttps://orcid.org/0000-0003-4669-7504Alan Diógenes Góishttps://orcid.org/0000-0003-3534-6557Márcia Martins Mendes De Lucahttps://orcid.org/0000-0002-9995-5637Gerlando Augusto Sampaio Franco de Limahttps://orcid.org/0000-0002-2414-2543ABSTRACT Narcissism (NARC) in senior executives has a perceptible impact on corporate decision-making and strategies and is often associated with unethical and opportunistic behaviors, including tax avoidance (TA). In this study, we therefore evaluated the association between chief executive officer (CEO) NARC and TA in Brazilian public firms. By focusing on Brazil, an emerging economy regulated by code law, our investigation makes an important contribution to the accounting literature on TA. Most studies examining the relation between corporate TA and CEO personality profile have been conducted in common law countries. According to the literature, TA behaviors are influenced by tax system specifics. In addition, the home country’s level of economic development should be taken into account when quantifying corporate TA. These observations, and the lack of previous investigation focusing on Brazil, ratify the relevance of the study. Our study also provides tax authorities, auditors, and investors with tools to identify narcissistic behaviors predictive of corporate TA, which may demand precautionary measures on part of business partners. The sample consisted of 68 Brazilian public firms (382 observations), covering the period 2010-2017, and a robust regression model with panel data was used. TA and NARC were measured with secondary data according to the literature. Our findings show a positive correlation between CEO NARC and TA. Executives with this personality trait come across as bold or aggressive, thus more prone to adopt TA strategies, as confirmed in the present study. The study contributes to the literature by demonstrating how a personality disorder like NARC affects corporate tax policies, with potential damage to corporate reputation.http://www.scielo.br/scielo.php?script=sci_arttext&pid=S1519-70772021000100080&tlng=ennarcissismtax avoidancechief executive officer (CEO)corporate reputationpersonality disorder |
| spellingShingle | Victor Cortez Araújo Alan Diógenes Góis Márcia Martins Mendes De Luca Gerlando Augusto Sampaio Franco de Lima CEO narcissism and corporate tax avoidance, Revista Contabilidade & Finanças narcissism tax avoidance chief executive officer (CEO) corporate reputation personality disorder |
| title | CEO narcissism and corporate tax avoidance, |
| title_full | CEO narcissism and corporate tax avoidance, |
| title_fullStr | CEO narcissism and corporate tax avoidance, |
| title_full_unstemmed | CEO narcissism and corporate tax avoidance, |
| title_short | CEO narcissism and corporate tax avoidance, |
| title_sort | ceo narcissism and corporate tax avoidance |
| topic | narcissism tax avoidance chief executive officer (CEO) corporate reputation personality disorder |
| url | http://www.scielo.br/scielo.php?script=sci_arttext&pid=S1519-70772021000100080&tlng=en |
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