Non-executive female directors and earnings management using classification shifting

Alaa Mansour Zalata, Tarek Abdelfattah

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Prior business studies have focused on the role of non-executive female directors in constraining accruals-based earnings management with relatively less attention paid to other less risky earnings management methods. In contrast to these studies, we investigate whether non-executive female directors go beyond the neoclassical measurement and recognition-based accounting issues and pay more attention to the classification of core expenses within the income statement. We find evidence supporting the ongoing debate that classification shifting is less likely to attract the attention of either external or internal monitors. We did not find evidence that non-executive female directors are more likely to challenge managers’ opportunistic classificatory practices; rather, the results reveal a significant positive relationship between non-executive female directors and classification shifting. Finally, our finding remains robust after controlling for potential endogeneity problems and tokenism.
Original languageEnglish
Pages (from-to)301-315
JournalJournal of Business Research
Early online date31 May 2021
Publication statusPublished - 1 Sept 2021


  • Female directors
  • Gender diversity
  • Earnings management
  • Classification shifting


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