Remote Board Meetings and Board Monitoring Effectiveness : Evidence from China

Using unique data on board meeting types of Chinese firms, we examine the effect of remote board meetings on board monitoring effectiveness. We find that compared to face-to-face meetings, remote meetings are associated with better meeting attendance behavior of directors, higher likelihood of director dissent on monitoring-related proposals, higher forced CEO turnover-performance sensitivity, and more effective investments. Proposal-director-level analysis further shows that remote meetings increase (reduce) dissension incentives of busy and young directors (first-term and socially connected directors). The results suggest that remote meetings improve board monitoring effectiveness by facilitating status equalization among directors and alleviating their pressure for conformity