Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemic
Impression management refers to controlling or shaping the information disclosed to affect readers’ interpretations. Managers may manipulate the tone and length of financial reports to manage stakeholders’ expectations. This exploratory study examines the impact of managerial ownership on impression...
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Language: | English |
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Taylor & Francis Group
2025-12-01
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Series: | Cogent Business & Management |
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Online Access: | https://www.tandfonline.com/doi/10.1080/23311975.2025.2458167 |
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author | Kwok Yip Cheung Chung Yee Lai |
author_facet | Kwok Yip Cheung Chung Yee Lai |
author_sort | Kwok Yip Cheung |
collection | DOAJ |
description | Impression management refers to controlling or shaping the information disclosed to affect readers’ interpretations. Managers may manipulate the tone and length of financial reports to manage stakeholders’ expectations. This exploratory study examines the impact of managerial ownership on impression management using Management Discussion and Analysis (MD&A) reports contained in annual reports for all A-shares listed in China from 2018 to 2021. In total, 5279 firm-year observations were collected from China. The results suggest that managerial ownership has a significantly inverted U-shaped relationship with impression management, indicating that executives who hold ownership in a company are more likely to engage in impression management. However, beyond 31% of managerial ownership, the effectiveness of oversight quality on impression management is strengthened, leading to decreased levels of impression management. This relationship is more prevalent during the COVID-19 pandemic (2020 and 2021). The findings of this study provide policy implications not only for China but also for Asian countries with similar institutional backgrounds. For example, managerial ownership should not be restricted to below 31%. Additionally, the findings provide additional mechanisms for investors to identify impression management during unstable financial periods. |
format | Article |
id | doaj-art-913705668d8f4ce4ac0c4313f5e9a7cc |
institution | Kabale University |
issn | 2331-1975 |
language | English |
publishDate | 2025-12-01 |
publisher | Taylor & Francis Group |
record_format | Article |
series | Cogent Business & Management |
spelling | doaj-art-913705668d8f4ce4ac0c4313f5e9a7cc2025-02-05T09:45:47ZengTaylor & Francis GroupCogent Business & Management2331-19752025-12-0112110.1080/23311975.2025.2458167Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemicKwok Yip Cheung0Chung Yee Lai1Department of Accounting, The Hong Kong University of Science and Technology, Hong Kong, Hong KongDepartment of Education, Brittany Université, Paris, FranceImpression management refers to controlling or shaping the information disclosed to affect readers’ interpretations. Managers may manipulate the tone and length of financial reports to manage stakeholders’ expectations. This exploratory study examines the impact of managerial ownership on impression management using Management Discussion and Analysis (MD&A) reports contained in annual reports for all A-shares listed in China from 2018 to 2021. In total, 5279 firm-year observations were collected from China. The results suggest that managerial ownership has a significantly inverted U-shaped relationship with impression management, indicating that executives who hold ownership in a company are more likely to engage in impression management. However, beyond 31% of managerial ownership, the effectiveness of oversight quality on impression management is strengthened, leading to decreased levels of impression management. This relationship is more prevalent during the COVID-19 pandemic (2020 and 2021). The findings of this study provide policy implications not only for China but also for Asian countries with similar institutional backgrounds. For example, managerial ownership should not be restricted to below 31%. Additionally, the findings provide additional mechanisms for investors to identify impression management during unstable financial periods.https://www.tandfonline.com/doi/10.1080/23311975.2025.2458167Managerial ownershipimpression managementCOVID-19pandemicChinaBusiness |
spellingShingle | Kwok Yip Cheung Chung Yee Lai Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemic Cogent Business & Management Managerial ownership impression management COVID-19 pandemic China Business |
title | Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemic |
title_full | Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemic |
title_fullStr | Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemic |
title_full_unstemmed | Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemic |
title_short | Inverted U-shaped relationships between managerial ownership and impression management: evidence from China before and during COVID-19 pandemic |
title_sort | inverted u shaped relationships between managerial ownership and impression management evidence from china before and during covid 19 pandemic |
topic | Managerial ownership impression management COVID-19 pandemic China Business |
url | https://www.tandfonline.com/doi/10.1080/23311975.2025.2458167 |
work_keys_str_mv | AT kwokyipcheung invertedushapedrelationshipsbetweenmanagerialownershipandimpressionmanagementevidencefromchinabeforeandduringcovid19pandemic AT chungyeelai invertedushapedrelationshipsbetweenmanagerialownershipandimpressionmanagementevidencefromchinabeforeandduringcovid19pandemic |