A Study on the Relationship between Chief Executive Officers’ Management and Accounting Majors and Tax Avoidance Tendency Based on Upper Echelons Theory

Upper echelons theory explains how the characteristics and experiences of companies’ top management affect organizational decision-making and strategy. According to this theory, the personal experiences and values of management deeply influence the direction and performance of companies. Based on this theory, this study verified the effect of managers’ major and degree on corporate management decision-making. In particular, how managers’ major and master of business administration (MBA) completion relate to companies’ tax avoidance tendency was examined. The analysis showed that companies with managers who majored in business administration or who completed an MBA had lower tax avoidance tendencies than those who did not. This suggests that managers who a completed business administration degree tend to make more ethical decisions. Therefore, retraining is necessary for companies with many managers or managers who have not completed their MBA. This study emphasizes the necessity of theoretical learning as well as the practical competence of managers, and shows that it is important to cultivate the ethics of managers. However, there may be limitations in the composition of variables in the study, industrial characteristics, and the reflection of macroeconomic variables.