ISSN: 2225-8329
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This conceptual paper proposes a comprehensive research framework to explore how board of directors (BOD) characteristics shape earnings management (EM) practices among publicly listed companies in China. The framework addresses a critical gap in the existing literature by systematically integrating various dimensions of BOD characteristics, including board size, board gender diversity, foreign directors, director’s financial background, CEO duality and board independence. The framework intends to test balanced panel dataset of 15,560 observations from 3,112 firms listed on the Shanghai and Shenzhen Stock Exchanges during 2018–2022 to evaluate the relationship between BOD characteristics and EM over time. By mapping out the theoretical linkages among these key variables, the proposed framework offers a structured approach for future empirical research to validate and extend the hypothesized relationships. It proposed an outline for examining how board may influence earnings management strategies, thereby informing the design of more effective corporate governance policies. This framework is particularly relevant for regulators, practitioners, and scholars seeking to enhance board oversight and strengthen financial reporting integrity in China’s rapidly evolving market environment, ultimately contributing to the development of robust governance mechanisms.
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