About

Patricia Dechow is the Robert R. Dockson Professor of Business Administration at USC Marshall School of Business, where she holds positions in Accounting, Finance, and Business Economics. Her research focuses on accounting accruals, the quality and reliability of earnings, the use of earnings information in predicting stock returns, and the effect of analysts' forecasts on investors’ perceptions of firm value. She has contributed to understanding how accounting practices spread, including the role of law firm networks in stock option backdating, and has analyzed the impact of pandemic shutdowns on equity prices through the development of implied equity duration. Her work demonstrates the importance of earnings quality, environmental, social, and governance (ESG) factors, and valuation in financial analysis. Dr. Dechow's research has been published in reputable journals such as the Journal of Accounting Research and The Accounting Review, and she is recognized for her expertise in the business of sustainability, earnings manipulation, and financial analysis.

Research topics

• Econometrics
• Financial economics
• Economics
• Monetary economics
• Finance

Selected publications

• Corporate response to the Black Lives Matter movement: determinants of speaking out in support of social causes

  Review of Accounting Studies · 2026-04-27

  articleOpen access

  Abstract We document that firms vary in their timeliness of support for the Black Lives Matter (BLM) movement following the death of George Floyd in May 2020, and that timeliness is an indicator of authenticity. We predict that firms that speak out quickly in support of BLM (via Twitter or their websites) have made more investments in diversity and inclusion, relative to firms that speak out slowly (via conference calls or annual reports) or that remain silent. Consistent with this prediction, quick -disclosing firms have greater workforce diversity, have boards with greater ethnic diversity, and are more likely to tie executive compensation to diversity and inclusivity. Furthermore, quick -disclosing firms increase their hiring of both Black American employees and Black directors relative to firms that stay silent. We also document that quick-disclosing firms are part of more supportive stakeholder networks. We develop an inclusivity index and show that firms with higher index levels are more likely to speak out on the Capitol Riots, the Asian Spa Shootings, and voting rights.

  PublisherOA PDFDOI

• A Comparison of the Greenhouse Gas Protocol's Corporate Standard to the E-Ledgers Measurement System

  SSRN Electronic Journal · 2025-01-01

  preprintOpen access1st authorCorresponding
  PublisherDOI

• Beyond Earnings Quality: Evaluating the Quality of Voluntary Corporate Financial Reporting Practices

  SSRN Electronic Journal · 2025-01-01 · 1 citations

  articleOpen access1st authorCorresponding
  PublisherDOI

• Media Attention and Event-Based Grouping of Stocks: An Examination of Stocks Hyped by Media Outlets as Benefiting from the Olympics

  Management Science · 2024-01-19 · 5 citations

  article1st authorCorresponding

  We examine five summer Olympics and identify stocks that media outlets hype as benefiting from the Olympics (Olympic stocks). There is a seven-year period from the time that a country first learns it has won the Olympic bid to the start of the games (Olympic time period). We predict that the excitement of the Olympics along with the greater media attention impacts the valuation and risk of Olympic stocks. Consistent with this prediction, we show that Olympic stocks earn higher returns than their matched counterparts and comove more strongly with each other over the Olympic time period. Olympic stocks also exhibit increases in trading volume and stock volatility on days when media outlets have stories linking the firm to the Olympic Games. However, we find no evidence that the Olympic Games translate into stronger fundamentals for Olympic firms or stronger fundamental comovements. These findings suggest that investors are not purchasing the stocks based on an analysis of fundamentals, but are purchasing them based on their Olympic attribute. To confirm that event-based groupings occur in other settings, we show that comovement increases for stocks classified by the media as “stay-at-home” stocks at the start of the COVID-19 pandemic. This paper was accepted by Eric So, accounting. Supplemental Material: The online appendix is available at https://doi.org/10.1287/mnsc.2021.02218 .

  PublisherDOI

• A rating system to evaluate non-GAAP exclusion quality

  Review of Accounting Studies · 2024-11-25 · 5 citations

  articleOpen access1st authorCorresponding

  Abstract We develop a rating system to evaluate the quality of individual non-GAAP exclusions. Our perspective is that high-quality exclusions reflect nonrecurring economic transactions, are transitory accounting adjustments, or have little usefulness in forecasting cash flows. We use four approaches to rate exclusions. We evaluate the serial correlation of the exclusion, survey accounting academics’ views, obtain practitioner ratings from the CFA Institute, and identify the exclusions approved by the Chinese securities regulator. A firm’s exclusion quality score is the weighted average rating of its individual exclusions. For our sample of S&P 500 firms, we document that exclusion quality varies by industry, captures trends in non-GAAP reporting, and is reasonably stable at the firm level. To validate the rating, we show that firms with lower exclusion quality scores receive more SEC comment letters, incur more Regulation G violations, exhibit greater analyst forecast dispersion, and have slower price discovery following earnings announcements.

  PublisherOA PDFDOI

• A rating system to evaluate non-GAAP exclusion quality

  SSRN Electronic Journal · 2023-01-01 · 11 citations

  articleOpen access1st authorCorresponding
  PublisherDOI

• Understanding the Sustainability Reporting Landscape and Research Opportunities in Accounting

  SSRN Electronic Journal · 2023-01-01 · 32 citations

  articleOpen access1st authorCorresponding
  PublisherDOI

• Understanding the Sustainability Reporting Landscape and Research Opportunities in Accounting

  The Accounting Review · 2023-08-31 · 69 citations

  article1st authorCorresponding

  ABSTRACT I first distinguish the terms economic growth, economic development, and sustainable development. I then discuss the term ESG and why this term is used with respect to the corporation. I follow with a discussion of the shareholder primacy perspective and how this perspective plays a defining role in corporate law, corporate governance, and asset management. I argue that the shareholder primacy perspective is not appropriate for sustainability reporting because when a firm pollutes the environment, reduces biodiversity, or has inequitable social policies, it does not bear the full cost of its action; society and the planet does. Therefore, providing sustainability disclosures that are relevant to investors misses the point that sustainability disclosures are motivated by the desire of other stakeholders to learn about externalities. I discuss the different standard setters in the sustainability space and how accounting and measurement play key roles. I close with a discussion of research opportunities. Data Availability: Data are publicly available from sources indicated in the text. JEL Classifications: K22; L21; M41; M48; Q56; Q58.

  PublisherDOI

• Gender Differences in the Strategies Used for Goal-Completion: An Analysis of Marathon Runners

  SSRN Electronic Journal · 2022-01-01

  articleOpen access1st authorCorresponding
  PublisherDOI

• Implied Equity Duration: A Measure of Pandemic Shutdown Risk

  Journal of Accounting Research · 2021 · 44 citations

  1st authorCorresponding
  • Economics
  • Econometrics
  • Financial economics

  ABSTRACT Implied equity duration was originally developed to analyze the sensitivity of equity prices to discount rate changes. We demonstrate that implied equity duration is also useful for analyzing the sensitivity of equity prices to pandemic shutdowns. Pandemic shutdowns primarily impact short‐term cash flows, thus they have a greater impact on low‐duration equities. We show that implied equity duration has a strong positive relation to U.S. equity returns and analyst forecast revisions during the onset of the 2020 COVID‐19 shutdown. Our analysis also demonstrates that the underperformance of “value” stocks during this period is a rational response to their lower durations.

  PublisherOA PDFDOI

Frequent coauthors

• Richard G. Sloan

  University of Southern California

  37 shared

• Haifeng You

  13 shared

• Amy P. Hutton

  Boston College

  13 shared

• Eric J. Allen

  University of California, Riverside

  9 shared

• Annika Yu Wang

  University of Houston

  8 shared

• Weili Ge

  University of Washington

  8 shared

• Alastair Lawrence

  London Business School

  7 shared

• Scott Richardson

  6 shared

Education

• PhD

  University of Rochester

  1992