Which Top Management Team Characteristics Drive a Firm’s Tax Aggressiveness?

Abstract

ABSTRACT This study examines the relationship between a firm’s tax planning and several observable characteristics of its top management team. We obtain empirical evidence based on multiple regressions of a sample of listed companies in China from 2013 to 2019. We find that a top management team’s education level positively relates to tax planning. While tenure, age, and expert experience are negatively related to tax planning. These results are robust when further tests are conducted. These findings provide further evidence of the upper echelon theory and research in the field of taxation area. Practically, the study provides useful insights for board committees to appoint top management team members pursuing healthy performance. Furtherly, this study is valuable to investors, creditors, analysts, and auditors, as it serves as a reminder that top management team characteristics need to be considered when making decisions.