Journal of Engineering, Project, and Production Management, 2026, 16(5), 2026-339
Impact of Board Diversity on Accounting Transparency and Earnings Persistence
1 Assistant
Professor, Financial Accounting, Department of Accounting, Al-Suwaira
Technical Institute, Middle Technical University, Baghdad, Iraq, E-mail:
halaayyed@mtu.edu.iq
2 Associate Professor, Department
of Accounting, College of Management and Finance, Al-Aqsa University,
Gaza, Palestine, E-mail: im.altaweel@alaqsa.edu.ps (corresponding
author).
Project Management
Received March 18, 2026; revised April 19, 2026; accepted April 20, 2026
Available online June 17, 2026
Abstract: This study examines whether board diversity moderates the relationship between accounting transparency and earnings persistence in an emerging market context. While prior research has examined the independent effects of corporate governance and financial reporting quality on earnings outcomes, limited attention has been given to how governance structures shape the usefulness of transparent financial information. Using panel data from all banks listed on the Palestine Exchange (PEX) during the period 2015-2025 (N = 55 bank-year observations), the study employs an interaction-based persistence model in which earnings persistence is conceptualized as the autoregressive relationship between current and future earnings. Accounting transparency is measured by information accuracy, standards compliance, and disclosure completeness, while board diversity is captured through factor analysis that distinguishes experiential diversity (age and professional experience) from demographic diversity (gender and educational background). Results indicate that accounting transparency alone does not significantly enhance earnings persistence. Instead, its effectiveness depends on board composition. Specifically, the three-way interaction between current earnings, accounting information accuracy, and experiential board diversity is positive and significant. This indicates that earnings persistence is stronger when transparent financial information is interpreted by boards with diverse professional experience. Demographic diversity does not exhibit a comparable moderating effect. These findings highlight the complementary roles of corporate governance and financial reporting in enhancing the informational value of earnings. They also provide new evidence from the Palestinian banking sector regarding governance conditions under which accounting transparency becomes most effective.
Keywords: Board diversity, accounting transparency, earnings persistence, corporate governance, emerging markets, Palestine exchange.
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Citation: Hadi, H. A. and Altaweel, I. M. A. (2026). Impact of Board Diversity on Accounting Transparency and Earnings Persistence. Journal of Engineering, Project, and Production Management, 16(5), 2026-339.
