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Prior research shows that firms tend to recruit directors from the geographically-proximate area. Due to a limited supply of qualified individuals in a given area, firms located in close proximity have to share a limited pool of talented individuals. As a result, the larger the number of firms...
Persistent link: https://www.econbiz.de/10012862139
The literature offers no clear evidence on the effect of independent directors on firm value. We argue that, during stressful times, firms may need more and better expert advice to navigate a crisis. Outside independent directors can provide such advice. So, the role of independent directors may...
Persistent link: https://www.econbiz.de/10012945479
conflicts, managers may not always adopt leverage choices that maximize shareholders' value. Consistent with the prediction of …
Persistent link: https://www.econbiz.de/10013127772
Motivated by the on-going debate on the costs and benefits of CSR, we explore how talented managers view CSR … managers view CSR investments favorably. However, only those with especially strong talent are in favor of CSR investments. For … investments, suggesting that these strongly talented managers perceive CSR as enhancing firm performance. By contrast, for those …
Persistent link: https://www.econbiz.de/10013015404
We explore the role of female directors in mitigating CEO luck. CEOs are “lucky” when they receive stock option grants on days when the stock price is the lowest in the month of the grant, implying opportunistic timing. Our results show that board gender diversity significantly deters the...
Persistent link: https://www.econbiz.de/10013240820
We argue that firms located close to one another tend to have similar CSR policies, due to investor clienteles, local competition, as well as social interactions. Our results are consistent with this notion. In particular, firms located in the same 3-digit zip code exhibit a similar degree of...
Persistent link: https://www.econbiz.de/10012976945
prevents managers from taking excessive risk. Additional analysis based on propensity score matching also confirms our results …
Persistent link: https://www.econbiz.de/10012953971
Motivated by agency theory, we explore how powerful CEOs influence the extent of stock price informativeness. Using idiosyncratic volatility to measure stock price informativeness, we find that firms with more powerful CEOs experience a more opaque information environment. This is consistent...
Persistent link: https://www.econbiz.de/10013029449
We explore the role of powerful CEOs on the extent of risk-taking, using Bebchuk, Cremers, and Peyer's (2011) CEO pay slice (CPS). Based on more than 12,000 observations over 20 years (1992-2012), our results reveal a non-monotonic association. In particular, relatively less powerful CEOs...
Persistent link: https://www.econbiz.de/10013053761
Motivated by agency theory, we explore how independent directors view managerial risk-taking incentives using a natural experiment. We exploit the passage of the Sarbanes-Oxley Act as an exogenous shock that raised board independence. Our difference-in-difference estimates show that independent...
Persistent link: https://www.econbiz.de/10012896321