Does earnings management constrain ESG performance? The role of corporate governance

Yusuf Babatunde Adeneye, Setareh Fasihi, Ines Kammoun, Khaldoon Albitar

Research output: Contribution to journalArticlepeer-review


Responding to the calls in both earnings management and sustainability literature to examine corporate governance patterns, this study fills the sustainability literature gap by shedding light on the moderating role of corporate governance on earnings management and environmental, social and governance performance. Using a sample of UK firms listed on the London Stock Exchange for the period 2016-2020, we find considerable evidence that earnings management reduces environmental, social and governance performance. Importantly, we find that board gender diversity among other corporate governance mechanisms is stronger and more effective in attenuating the negative effects of earnings management on environmental, social and governance performance significantly. We find support for the agency theory that corporate governance mechanisms reduce the managerial exploitation of resources required for sustainable investments and sustainability performance.
Original languageEnglish
Number of pages24
JournalInternational Journal of Disclosure and Governance
Early online date8 May 2023
Publication statusEarly online - 8 May 2023


  • earnings management
  • environmental
  • social
  • governance performance
  • corporate governance

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