Unified or divided? Conflicting interests of controlling shareholders in corporate tax avoidance

This study examines the heterogeneity among controlling shareholders on corporate tax avoidance. Findings reveal that controlling shareholders are divided on tax avoidance behavior, which leads to less tax avoidance; however, they are unified in earnings management and R&D expenditure. Additional analysis shows that their divided interests are influenced by several factors, such as shareholder type, related-party transactions, family business status, Chaebol affiliation, and firm maturity. This study underscores that controlling shareholders, once considered a single entity, encompass individuals who counterbalance each other's interests; thus, reassessing their corporate governance role is necessary.