Risk committee, corporate risk-taking and firm value
Purpose: The authors empirically examine the impact of the stand-alone risk committee on corporate risk-taking and firm value. Design/methodology/approach: The authors argue that the existence of a stand-alone risk committee enhances the quality of corporate governance, which reduces corporate risk-taking and strengthens the firm value that might improve investor protection. Findings: The authors find corporate risk-taking decline significantly for firms that have a stand-alone risk committee compared with firms that have a joint audit and risk committee. The authors also find that the presence of a stand-alone risk committee is positively associated with firm value. Practical implications: The evidence is consistent with the proposition that firms with a stand-alone risk committee can effectively evaluate potential risks and implement a proper risk management system. Originality/value: This is the first paper that investigates the association between the existence of a stand-alone risk committee and firm risk-taking in a multi-industry setting. Also, our research extends the association between a stand-alone risk committee and firm value.
Year of publication: |
2020
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Authors: | Bhuiyan, Md. Borhan Uddin ; Cheema, Muhammad A. ; Man, Yimei |
Published in: |
Managerial Finance. - Emerald, ISSN 0307-4358, ZDB-ID 2047612-7. - Vol. 47.2020, 3 (12.09.), p. 285-309
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Publisher: |
Emerald |
Saved in:
Online Resource
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