Recruiting Dark Personalities for Earnings Management

Journal of Business Ethics, Forthcoming

Posted: 16 Feb 2021

See all articles by Ling L. Harris

Ling L. Harris

University of Nebraska-Lincoln

Scott B. Jackson

University of South Carolina

Joel Owens

Portland State University

Nicholas Seybert

University of Maryland - Department of Accounting & Information Assurance

Multiple version iconThere are 2 versions of this paper

Date Written: January 28, 2021

Abstract

Prior research indicates that managers’ dark personality traits increase their tendency to engage in disruptive and unethical organizational behaviors including accounting earnings management. Other research suggests that the prevalence of dark personalities in management may represent an accidental byproduct of selecting managers with accompanying desirable attributes that fit the stereotype of a “strong leader.” Our paper posits that organizations may hire some managers who have dark personality traits because their willingness to push ethical boundaries aligns with organizational objectives, particularly in the accounting context where ethical considerations are especially important. Using several validation studies and experiments, we find that experienced executives and recruiting professionals favor hiring a candidate with dark personality traits into an accounting management position over an otherwise better-qualified candidate when the hiring organization faces pressure to manage earnings. Our results help to illuminate why individuals with dark personality traits may effectively compete for high-level accounting positions.

Keywords: ethics, earnings management, employee selection, recruiting, hiring, accounting, management, job candidates, narcissism, dark triad, personality traits, experiment

JEL Classification: M10, M12, G30, M14, M40, M41, M50, M51

Suggested Citation

Harris, Ling and Jackson, Scott B. and Owens, Joel and Seybert, Nicholas, Recruiting Dark Personalities for Earnings Management (January 28, 2021). Journal of Business Ethics, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3775125

Ling Harris

University of Nebraska-Lincoln ( email )

730 N. 14th Street
Lincoln, NE 68588
United States
4024722019 (Phone)

Scott B. Jackson

University of South Carolina ( email )

School of Accounting
Moore School of Business
Columbia, SC 29208
United States
(803) 777-3100 (Phone)

Joel Owens (Contact Author)

Portland State University ( email )

PO Box 751
Portland, OR 97207
United States

Nicholas Seybert

University of Maryland - Department of Accounting & Information Assurance ( email )

Robert H. Smith School of Business
College Park, MD 20742-9157
United States

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