THE RELATIONSHIP BETWEEN BOARD STRUCTURE AND EARNINGS QUALITY OF LISTED COMPANIES ON THE STOCK EXCHANGE OF THAILAND: THE MODERATING EFFECT OF OWNERSHIP STRUCTURE

Abstract

Board directors are entrusted with the responsibility to perform their duties transparently and to foster desirable managerial behavior by ensuring the quality of financial reporting, particularly within an effective ownership structure. Building on this premise, the objective of this study was to investigate the influence of board structure on the earnings quality of companies listed on the Stock Exchange of Thailand (SET100 index), considering the moderating effect of ownership structure. The analysis is based on 165 firm-year observations from 2016 to 2019, with the new paradigm of discretionary accruals, based on the Modified John and Yoon model, serving as a proxy for earnings quality. The findings provide valuable insights into how corporate governance practices influence earnings quality. Specifically, larger board size, and CEO duality, are associated with lower earnings quality, while ownership structure can either exacerbate or mitigate this effect. The study offers both theoretical and managerial contributions, emphasizing the importance of strengthening corporate governance to enhance earnings quality in Thai businesses.