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Gender Diverse Boardrooms and Earnings Manipulation: Does Democracy Matter?

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  • Evangelos G. Varouchas

    (Department of Accounting and Finance, Hellenic Mediterranean University, 71410 Heraklion, Crete, Greece)

  • Stavros E. Arvanitis

    (Department of Accounting and Finance, Hellenic Mediterranean University, 71410 Heraklion, Crete, Greece)

  • Christos Floros

    (Department of Accounting and Finance, Hellenic Mediterranean University, 71410 Heraklion, Crete, Greece)

Abstract

We investigate the influence of boardroom gender diversity on earnings management. Drawing on a sample of European firms over the 2010–2023 period, we document an inverted U-shaped nexus between boardroom gender heterogeneity and earnings manipulation. Moreover, we also find that the Democracy Index moderates the curvilinear nexus by flattening the inverted U-curve and shifting the inflection point leftward. Our findings are consistent across various measures of earnings management and different econometric approaches, offering valuable insights for European policymakers.

Suggested Citation

  • Evangelos G. Varouchas & Stavros E. Arvanitis & Christos Floros, 2025. "Gender Diverse Boardrooms and Earnings Manipulation: Does Democracy Matter?," Risks, MDPI, vol. 13(7), pages 1-15, June.
    • Handle: RePEc:gam:jrisks:v:13:y:2025:i:7:p:126-:d:1690930
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