volume 35, issue 3, P429-447 2020
DOI: 10.1108/maj-01-2019-2122
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Andrea Gouldman, Lisa Victoravich

Abstract: Purpose The purpose of this study is to examine the possibility of adverse consequences regarding the recently enacted Dodd–Frank Act (DFA) pay-equity disclosure requirement in the USA, which will likely lead to lower levels of perceived Chief Executive Officer (CEO) pay fairness by subordinates. Specifically, the study examines whether the pay-equity disclosure leads to increased earnings management when business-unit managers have friendship ties with the CEO. Design/methodology/approach An experiment is …

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