Corporate Culture and Tax Planning

Research output: Contribution to journalArticleScientificpeer-review

Abstract

In this paper, we study the relationship between corporate culture and tax planning. Using the competing values framework and natural language processing techniques, we document that firms with collaboration-oriented (control-oriented) corporate cultures are associated with lower (higher) effective tax rates. We further find that firms with collaboration-oriented corporate cultures achieve these tax savings by engaging in tax-sheltering activities and that such savings positively affect firm value. While firms with salient control-oriented characteristics have previously been recognized to benefit from small tax burdens, we contribute with new evidence suggesting that intra-organizational reciprocity can also promote tax savings that ultimately benefit shareholders.
Original languageEnglish
Peer-reviewed scientific journalReview of Quantitative Finance and Accounting
ISSN0924-865X
Publication statusAccepted/In press - 25.06.2024
MoE publication typeA1 Journal article - refereed

Keywords

  • 512 Business and Management
  • Corporate culture
  • competing values framework
  • text analysis
  • tax planning
  • tax sheltering
  • firm value

Areas of Strength and Areas of High Potential (AoS and AoHP)

  • AoS: Financial management, accounting, and governance

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