Earnings expectations and employee safety

Caskey, Judson; Ozel, N. Bugra

doi:10.1016/j.jacceco.2016.12.002

Cited by 171 publications

(103 citation statements)

References 43 publications

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“…In other words, the introduction of Reg SHO elevates myopic behavior among managers of the pilot firms, which could be observed by an increase in workrelated injuries. Our conjecture is in line with Cohn et al (2019) and Caskey and Ozel (2017) that workplace injuries would increase following more pressure from the financial market.…”

Section: Short-selling Constraints and Investments In Workplace Safetysupporting

confidence: 93%

“…This is supported by Graham et al (2005), who show that managers reduce their maintenance expenditures to meet earnings expectations. That is further supported by Caskey and Ozel (2017), who find that managers tend to cut off safety spending to meet their earnings expectations. Moreover, there is mixed evidence on the real impact of Reg SHO on firms' investment.…”

Section: Introductionmentioning

confidence: 80%

“…where i, j, and k index establishment, firm, and industry, respectively. Our main dependent variable is the total case rate, Cohn and Wardlaw (2016) and Caskey and Ozel (2017).…”

Section: Empirical Methodologymentioning

confidence: 99%

“…As an executive agency within the Department of Although the injury data from OSHA provide names of the reporting establishments, they do not come with a unique firm-level identifier. 14 We thus perform an extensive fuzzy matching based on establishment names, addresses, and COMPUSTAT firm names, following Caskey and Ozel (2017). We further manually search on Google, firms' Web sites and annual reports (10K), and other online sources to assure the fuzzy matching results.…”

Section: Workplace Safety Datamentioning

confidence: 99%

“…The issue of workplace safety has drawn attention from financial economists only recently. Several papers document that determinants of workplace safety include leverage (e.g., Cohn & Wardlaw, 2016;Filer & Golbe, 2003;Nie & Zhao, 2017), analysts' forecast pressure (Caskey & Ozel, 2017), and private equity buyouts (Cohn, Nestoriak, & Wardlaw, 2019). We expand our understanding of workplace safety and firms' investment in worker welfare by documenting a causal relationship between short-selling constraints and workplace injury rates.…”

Section: Introductionmentioning

confidence: 99%

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Capital market frictions and human capital investment: Evidence from workplace safety around regulation SHO

Bai

Lee

Zhang

2020

The Financial Review

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This paper examines the effect of capital market frictions on firms' workplace safety. Using Regulation SHO as a natural experiment, we find a significant increase in work-related injury rates of pilot firms.The effect is stronger for firms in more competitive industries and with high financial constraints, and weaker for firms whose employees have high negotiating power and with good corporate governance. Further tests suggest that managers' myopia shifts their focus away from investments in workplace safety when workplace safety is not related to firm performance. Overall, the results highlight how capital market frictions affect firms' investment in human capital. K E Y W O R D Smanagerial myopia, regulation SHO, short selling, workplace safety

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Section: Short-selling Constraints and Investments In Workplace Safetysupporting

confidence: 93%

Section: Introductionmentioning

confidence: 80%

“…where i, j, and k index establishment, firm, and industry, respectively. Our main dependent variable is the total case rate, Cohn and Wardlaw (2016) and Caskey and Ozel (2017).…”

Section: Empirical Methodologymentioning

confidence: 99%

Section: Workplace Safety Datamentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Capital market frictions and human capital investment: Evidence from workplace safety around regulation SHO

Bai

Lee

Zhang

2020

The Financial Review

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Confucianism and employee treatment: Evidence from China

Xu,

Wang

2024

Corp Soc Responsibility Env

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This study examines the effect of Confucianism, an influential cultural belief and ethical philosophy in East Asia, on employee treatment policies within Chinese listed companies from 2010 to 2020. Our key finding is that Confucianism is positively associated with employee‐friendly practices. We further identify three plausible economic channels through which Confucianism shapes employee‐friendly treatment: valuing human‐centric ethics, mitigating managerial myopia, and alleviating agency conflicts. Cross‐sectionally, the documented impact is more prominent for firms operating with weaker union power and those with executives lacking overseas experience. Additionally, employee‐friendly firms exhibit higher employee efficiency, innovation output, and firm value, indicating that investing in employee benefits ultimately translates into better financial performance. Collectively, we shed light on the unique role of cultural norms in fostering employee treatment policies and their consequential effects on organizational value.

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The effect of shareholder pressure on stakeholder interests: Evidence from corporate tax avoidance

Jiang,

Bao,

Yang

2024

Int. J Fin Econ

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Research on how shareholder pressure influences the interests of stakeholders has recently witnessed a sharp increase, but yields mixed findings. We revisit this question by investigating the impact of managers' attempts to meet or beat earnings expectations on corporate tax avoidance. Using a sample of Chinese listed firms during 2005–2022, we find that firms with earnings pressure are more tax‐aggressive. Furthermore, such a higher level of tax avoidance due to earnings pressure is associated with higher real activity management. Cross‐sectional analysis shows that the effect of earnings pressure on tax avoidance is weaker among firms with better environment, society, and governance performance, but becomes more salient for state‐owned enterprises, firms with higher financial constraints, and during periods when local officials are devoid of incentives for career advancement. Taken together, our study sheds light on the consequences of shareholder pressure stemming from capital markets on corporate tax policies, and provides implications for enterprises and policymakers concerning taxation in emerging markets.

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Earnings expectations and employee safety

Cited by 171 publications

References 43 publications

Capital market frictions and human capital investment: Evidence from workplace safety around regulation SHO

Capital market frictions and human capital investment: Evidence from workplace safety around regulation SHO

Confucianism and employee treatment: Evidence from China

The effect of shareholder pressure on stakeholder interests: Evidence from corporate tax avoidance

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