The impact of birth order among descendant family CEOs on family firm earnings management

ABSTRACTThis study investigates the impact of descendant family CEOs’ birth order on upward earnings management. Based on a sample of public family firms listed on the Korean Stock Exchange from 2000 to 2015, we find that non-first-son descendant CEOs have greater incentives to frame performance in a better light and positively influence stakeholder perceptions compared to their first-son counterparts. Our findings shed insight into how descendant family CEOs may in fact face differing pressures as a family heir and that birth order creates a divergence in their tangible efforts to overcome such challenges.KEYWORDS: Family CEOearnings managementbirth orderfamily firmJEL CLASSIFICATION: M12M41 Disclosure statementNo potential conflict of interest was reported by the author(s).Correction StatementThis article has been corrected with minor changes. These changes do not impact the academic content of the article.Additional informationFundingThis work was supported by the 2021 Research Fund of Myongji University.