Can Paying Too Much or Too Little Tax Contribute to Forced CEO Turnover?

• 成果类型: Article
• 署名作者: Chyz, James A.; Gaertner, Fabio B.
• 署名单位: University of Tennessee System; University of Tennessee Knoxville; University of Wisconsin System; University of Wisconsin Madison
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/accr-51767
• 发表日期: 2018
• 页码: 103-130
• 关键词: Management turnover; Managerial ability; incentives; avoidance; executives; FIRMS

摘要

Our study examines the effect of corporate tax outcomes on forced CEO turnover. While prior research argues that firms often do not engage in tax avoidance due to reputational concerns, the empirical evidence suggesting the existence of reputational costs is scarce. In a broad sample of firms, we find evidence of a relation between the payment of low taxes and forced turnover. We also find that forced CEO turnover is more likely when the firm pays a high tax rate relative to its peers. Our results are consistent with the existence of previously unexplored individual reputational costs for not engaging in tax avoidance.