Investigating the relationship between social responsibility and profit management of banks, emphasizing the moderating role of CEO power

Considering the impact of CEO Power on a bank’s performance, CEOs can play a role in social responsibility and earnings management. Since earnings management in banks can have various effects on other industries and the economy overall, banks tend to practice earnings management more than non-financial organizations. Moreover, due to lack of transparency and information asymmetry, banks are required to answer to the society than other industries. Therefore, the current research studies the impact of CEO Power on the relationship between social responsibility and earnings management in banks. The research sample includes 16 banks enlisted in the Tehran Stock Exchange Market and Iran OTC between 2016 to 2021 to test the research hypothesis. The findings of the research hypothesis indicate that social responsibility has a significant negative impact on earnings management in banks, which means that increase in social responsibility may lead to decrease in information asymmetry and decrease in lack of transparency, and as a result decrease in earnings management. Also, the findings of the research showed that the CEO power does not play a role in adjusting the relationship between social responsibility and earnings management in banks.