Masculinity, Testosterone, and Financial Misreporting

86 Pages Posted: 16 May 2013 Last revised: 10 Sep 2014

Yuping Jia

Frankfurt School of Finance and Management

Laurence van Lent

Tilburg University

Yachang Zeng

Nanyang Technological University

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Date Written: August 25, 2014


We examine the relation between a measure of male CEOs’ facial masculinity and financial misreporting. Facial masculinity is associated with a complex of masculine behaviors (including aggression, egocentrism, risk-seeking, and maintenance of social status) in males. One possible mechanism for this relation is that the hormone testosterone influences both behavior and the development of the face shape. We document a positive association between CEO facial masculinity and various misreporting proxies in a broad sample of S&P1500 firms during 1996–2010. We complement this evidence by documenting that a CEO’s facial masculinity predicts his firm’s likelihood of being subject to an SEC enforcement action. We also show that an executive’s facial masculinity is associated with the likelihood of the SEC naming him as a perpetrator. We find that facial masculinity is not a measure of overconfidence. Finally, we demonstrate that facial masculinity also predicts the incidence of insider trading and option backdating.

Keywords: Financial misreporting, neuroendocrinology, testosterone exposure, craniofacial growth, facial structure

JEL Classification: M12, M20, M40, M50, Z00

Suggested Citation

Jia, Yuping and van Lent, Laurence and Zeng, Yachang, Masculinity, Testosterone, and Financial Misreporting (August 25, 2014). Journal of Accounting Research, Forthcoming. Available at SSRN: or

Yuping Jia

Frankfurt School of Finance and Management ( email )

Sonnemannstraße 9-11
Frankfurt am Main, 60314
0049 69 154008 839 (Phone)

Laurence Van Lent

Tilburg University ( email )

Tilburg School of Economics and Management
P.O. Box 90153
5000 LE Tilburg
+31 13 4668288 (Phone)
+31 13 4668001 (Fax)


Yachang Zeng (Contact Author)

Nanyang Technological University ( email )

Singapore, 639798

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