Auditor choice, board of directors’ characteristics and ownership structure: Evidence from Greece

Download This Article

Marios Fasoulas ORCID logo, Evangelos Chytis ORCID logo, Ekaterini Lekarakou, Stergios Tasios ORCID logo

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.


Auditing is a key factor of financial reporting quality which reduces information asymmetry, improves regulatory compliance, and enhances internal control effectiveness. The decision to select an audit firm is complex and the reasons for choosing a specific auditor are likely to differ across organizations (Knechel et al., 2008). Several factors drive auditor selection, including ownership structure, governance attributes, the risk of information asymmetry, and country-level determinants (Habib et al., 2019). This study aims to examine whether corporate governance mechanisms affect auditor choice. For this purpose, using a sample of the biggest companies listed on the Athens Stock Exchange (ASE) for the period of 2014 to 2018, a logit regression model was developed to investigate the influence of the board characteristics and ownership structure on the decision to appoint a Big Four or non-Big Four audit firm. Results indicate that corporate governance mechanisms do affect auditor selection in Greece. Firms with larger boards, with more independent members and women on their boards’ composition, are more likely to appoint a Big Four audit firm. On the other hand, family-owned firms are less likely to engage a Big Four audit firm. The study’s results add new evidence on the factors that affect auditor choice in a European emerging market and could be useful to the regulatory authorities, investors, boards, and all other parties engaged in corporate governance.

Keywords: Auditor Choice, Big Four, Corporate Governance, Ownership, Board of Directors, Women, Greece

Authors’ individual contribution: Conceptualization — M.F. and S.T.; Methodology — M.F., E.L., and S.T.; Formal Analysis — M.F. and S.T.; Resources — M.F., E.L., and S.T.; Writing — Original Draft — M.F. and S.T.; Writing — Review & Editing — E.C. and E.L.; Supervision — E.C. and S.T.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: M14, M41, M42

Received: 22.02.2023
Accepted: 23.01.2024
Published online: 25.01.2024

How to cite this paper: Fasoulas, M., Chytis, E., Lekarakou, E., & Tasios, S. (2024). Auditor choice, board of directors’ characteristics and ownership structure: Evidence from Greece. Journal of Governance & Regulation, 13(1), 147–159.