核心代理問題與盈餘管理：董事會結構與外部監督機制之探討

Central Agency Problem and Earnings Management: An Investigation of Board Structure and External Monitoring Mechanism

近年來國內外企業舞弊案件層出不窮，如何確保投資者的權益免於受到侵害，已逐漸受到各界重視。深究國內陸續爆發之弊案，皆可發現其存在公司主要股東身兼管理者之特性，而產生所謂核心代理之問題。本研究之目的在探討於此特殊股權結構下，是否會引發公司管理當局盈餘管理之行為；同時也探討董事會結構與外部監督機制，對該盈餘管理行為之影響。實證結果顯示，當管理當局擁有之控制權超越其盈餘分配權，而導致控制股東與小股東間的核心代理問題時，公司的盈餘管理行為會增加。此外，本研究更進一步發現該盈餘管理之行為，會隨著董監事股權質押比率的提高而更明顯；但是會隨著法人機構持股比率的增加與董事會規模的擴大而降低。本研究結果可協助釐清管理當局持股和其盈餘操弄行為之關係。

The almost continuous and well-publicized major financial scandals of public companies in recent years in many countries, including Taiwan and the U.S., have greatly raised concerns on the inadequacy of protecting investors and other stakeholders. Many countries have since introduced legislations and installed new monitoring bodies to improve financial reporting quality and enhance protections of stakeholders. Thus, improving financial reporting quality and eliminating earnings management is an important and yet very challenging issue. A common characteristic shared by many public companies involved in financial scandals is that many major shareholders of firms involved in financial scandals also hold management positions in the same company. The failure to separate business ownership and management control when there are other shareholders creates a “central agency problem” between the major and the minority shareholders. This problem is much more serious in Taiwan than in other countries because it is common for the companies in Taiwan to gain control rights of another public company through cross-holdings. The less than desired information transparency of companies in Taiwan makes the central agency problem even worse. The purpose of this study is to investigate whether the central agency problem is a significant factor in earnings management behavior. In addition, this study also examines two other factors that have been documented to have significant effects on earnings management behavior: structure of the board of directors and external monitoring mechanism. The study collects research data from 1996 to 2004 of the public companies from the Taiwan Economic Journal (TEJ) database and uses the discretionary accruals as the proxy for earnings management. Corporate governance data are also obtained from TEJ to estimate the control rights, cash flow rights, and their differences. The empirical results indicate that when managers of the companies have more control rights than cash flow rights, which results in a central agency problem, managers are more likely to manage earnings. Such behavior is likely conducted for managers’ self-interests and at the expenses of the companies and other minority shareholders. The results also show that firms engage in more earnings management as the collateralized shares of board members increase, possibly a result of the personal funds of the board members being affected by the stock price of the companies. The results also show that as the shares controlled by institutional investors increase and as the size of the board of the directors increases, managers engage in less earnings management behavior. One explanation is that institutional investors own, usually, more shares than an individual shareholder and, therefore, have incentives to monitor the operating activities of the companies. Furthermore, institutions have the resources and abilities to carry out effective monitoring of the management. With activities of the firm being monitored closely by institutional shareholders, managers’ earnings management behavior will be inhibited or contained. Finally, as the size of the board increases, the board is likely to have more members with different professional backgrounds and experiences. Thus, a large board can better monitor managers than a small board and thus contain managers’ earnings management behavior. Unlike the traditional agency problem between managers and outside shareholders that was first exposed in Berle and Means (1932) and has since been examined extensively in the literature, this study examines the central agency problem. The existing literature has attempted to employ the traditional agency theory to account for the behavior of earnings management and yielded inconsistent results. This study focuses on the divergence between control rights and cash flow rights in examining companies’ earnings management behavior. Through this effort, results of the study help us better understand the relationship between the central agency problem and earnings management. This study represents a first attempt to examine empirical evidence on the relationship between the central agency problem and earnings management of the companies in Taiwan. The results obtained here should be of interest to investors, financial statement users, regulators, and the government.