Does experience matter? An examination of individual Auditor's experience on executive implicit corruption

Executive corruption stands as a pervasive issue in the capital market, posing a substantial threat to the healthy and steady growth of companies. Using data from Chinese listed companies from 2007 to 2019, this study comprehensively investigates the correlation between individual auditor's experience and executive implicit corruption, delving deeper into the functions of both internal and external corporate governance frameworks. The results indicate that individual auditor's industry-specific and client-specific expertise play a critical role in mitigating executive implicit corruption. Further analysis suggests that as national anti-corruption efforts intensify and media scrutiny increases, the significance of auditor experience in combating executive corruption becomes even more evident. Additionally, in state-owned enterprises and companies with high transparency, the experience of individual auditors exerts a stronger influence in mitigating executive corruption, emphasizing its increased importance in a governance environment marked by transparency and standardization. This study not only guides practical corporate governance efforts but also provides substantial theoretical support for shaping relevant policies and regulatory interventions, highlighting the unique and substantial contributions of auditor individual characteristics to corporate governance and transparency. •Auditor's experience plays a pivotal role in mitigating executive corruption.•As external oversight strengthens, the significance of auditor's experience in curbing executive corruption becomes more pronounced.•Individual auditor's experience can notably inhibit executive corruption in state-owned enterprises or transparent companies.