FAR Practice Note - Does Personality Relate to Job Performance of Partners and Managers?
Recent audit partner research finds that variation in partner characteristics affects the quality of audit engagements. Most of this research uses publicly available data on partner demographics such as age, gender, experience, industry expertise, and workload (busyness). In contrast, our study uses validated survey instruments to measure the personality traits of Dutch audit partners and managers. Contrary to what one might think, there is wide variation in the personality traits of auditors – they’re not homogenous. The organizational behavior (OB) literature documents the importance of personality in explaining job performance. Consistent with the OB literature, we find that personality traits do have a significant association with the job performance of audit partners and managers, as assessed by audit firms in their annual performance reviews. There are direct effects of some personality traits on performance such as “extraversion” which is positively associated with performance. There are also indirect effects on performance in which personality traits affect job skills (technical, commercial, leadership) and these job skills, in turn, affect job performance. The study has implications for hiring, and for targeted training to better manage the effects of diverse personality traits among auditors. Finally, there are implications for diversity. As people move from manager to partner, there is a narrowing of personality traits, and extroverted individuals are more likely to be rewarded and promoted to partner. Yet firms say they want diversity in their firms, and we argue that personality traits are an important dimension of diversity that firms need to explicitly manage.
Authors
Professor Jere Francis is ranked among the top ten academics to publish in leading scientific journals in the field of accountancy research. He won two awards from the American Accounting Association (AAA) for his substantial contribution to auditing research. He was also named Outstanding Audit Educator in 2013 by the AAA. Professor Francis served on the editorial boards of several leading scientific journals, including Abacus, Accounting Organizations & Society, Accounting & Finance, Auditing: A Journal of Practice & Theory, Contemporary Accounting Research, Journal of Accounting & Economics, Review of Accounting Studies, and The Accounting Review. In addition to being of scientific import, his research has been of practical significance to accountants and regulatory authorities and he has presented his research to leading international accountancy firms, the American Institute of Certified Public Accountants, the World Bank and the Public Company Accounting Oversight Board in the United States. As FAR Research Chair, Professor Francis conducts scientific research on the quality of audits. He will also boost auditing education in the Netherlands with the help of several PhD students as part of this chair position.
Professor Barrick’s research focuses on the impact individual differences in behavior and personality have on job performance and on methods of measuring and predicting such differences. He also is a co-author of the Theory of Purposeful Work Behavior, which highlights the role of purposefulness and experienced meaningfulness arising within the person as a key to explaining person-situation interactions. Further, Barrick studies executive team success, examining the role of the CEO, personality and leadership of TMT members, team composition, team interdependence, and team processes on individual, team, and firm performance. Finally, he also has examined the influence candidate self-presentation tactics have on the interviewer during an employment interview.
Olof Bik is professor of Auditing & Assurance at the University of Groningen. In his research he takes a special interest in the study of culture, leadership, and behavior in the realm of the auditing and assurance profession, firms, and teams. Since its inception in 2015 until 2022, Bik was one of two managing directors and academic member of the Board of the Foundation for Auditing Research. He worked in the audit practice of PwC for 18 years, since 2002 always in combination with a university appointment (Groningen), and joined academia in full since 2012 (Nyenrode).
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Lena Pieper is Assistant Professor at Gies College of Business at the University of Illinois Urbana-Champaign. She joined Gies after completing a PhD from Maastricht University’s School of Business and Economics in the Netherlands. Lena spent time at Gies as a visiting PhD student in Spring 2022, and she brings research experience in auditing and leadership.
Ann Vanstraelen is Full Professor of Accounting and Assurance Services at Maastricht University and serves as Head of the department of Accounting and Information Management. She coordinates the multidisciplinary research theme "Culture, Ethics and Leadership". She earned her PhD at the University of Antwerp. Her research interests relate to the broad field of auditing and assurance services, governance, corporate reporting and disclosure, with a specific focus on the quality of accounting and auditing practices.