ABSTRACT
The purpose of this research is to determine the effect of the Chief Executive Officer (CEO)’s tenure period on earnings management behaviour. CEOs will gain a good reputation if they can generate higher profits for the company during their tenure. This study analyses CEOs’ behaviour in managing earnings by using their discretion in the early years of their tenure. The research samples were taken from banks listed in the Indonesia Stock Exchange. The findings show that, in the banking industry, the CEOs’ early years of tenure affect their earnings management behaviour. In addition, an analysis was done to understand the characteristics of the samples that might strengthen the results. The additional analysis shows that the competition in the CEO job market in the Indonesian banking industry is very low, so they might not face external pressures to maintain a good reputation, which may affect their performance. In other words, the performance of Indonesian CEOs in the banking industry is not affected by their career concerns, but by their reputation with the shareholders internally.
