2021 journal article

Board Risk Oversight and Corporate Tax-Planning Practices

JOURNAL OF MANAGEMENT ACCOUNTING RESEARCH, 33(1), 7–32.

By: M. Beasley n , N. Goldman n, C. Lewellen n & M. McAllister*

co-author countries: United States of America πŸ‡ΊπŸ‡Έ
author keywords: board risk oversight; tax-planning practices; enterprise risk management; tax-planning levels; tax-planning volatility
Source: Web Of Science
Added: June 10, 2021

ABSTRACT Risk oversight by the board of directors is a key component of a firm's enterprise risk management framework, and recently, boards have paid more attention to their firm's tax-planning activities. In this study, we use a hand-collected sample of proxy statement disclosures about the board's role in risk oversight and provide evidence that risk oversight is negatively associated with both tax uncertainty and overall tax burdens. We find that risk oversight is most strongly associated with positions that yield permanent tax benefits and also with less risky tax-planning activities. Overall, the evidence suggests that board risk oversight is associated with more effective tax-planning practices.