Corporate Ethics and Ethical Judgment of Earnings Management—Psychological Safety as Mediator

Abstract

Earnings management has long been recognized as a critical ethical issue in the accounting profession. It is an embody of the extreme greedy of human beings, which is affected by the individual ethical judgment. Although some previous studies suggested that there exists earning management phenomenon in many Chinese enterprises, there is no comprehensive research on earnings management or ethical judgment of earnings management in China. It is necessary to do a study on ethical judgment of earnings management. As a moral issue, the implementation of the earnings management should depend on some ethical judgments. But there is less literature about the relationship between ethical judgment of earnings management and corporate ethics. Therefore, this study mainly focus on the corporate ethics and ethical judgment of earnings management. The study chose corporate ethics as independent variable, ethical judgment of earnings management as dependent variable, and added psychological safety as mediate variable to explore the relationship between these three factors. In order to discover the influence factor of the ethical judgment of earnings management, so as to enhance and promote the ethical judgment of employees.