Purpose: This study examines whether co-opted directors influence analysts' recommendations. As information intermediaries, financial analysts should incorporate the quality of corporate governance into their valuation because well-governed firms are associated with lower agency costs and better...

This chapter assesses the behavior of corporate managers and boards of directors within the framework of agency theory, stewardship theory, and psychological biases. In agency theory, a chief executive officer (CEO) is motivated to act in his or her own best interests rather than those of...

This study investigates how debt maturity structure is influenced by the strength of shareholder rights. The empirical evidence reveals an inverse relation between the strength of shareholder rights and debt maturity. We contend that managers of firms with weak shareholder rights eschew choosing...

Exploiting the passage of the Sarbanes-Oxley Act as a quasi-natural experiment, we explore how independent directors view generalist vs. specialist CEOs. Generalist CEOs possess the general managerial skills that can be applied across firms and industries. Our difference-in-difference estimates...

Purpose – Theory suggests that the market for corporate control, which constitutes an important external governance mechanism, may substitute for internal governance. Consistent with this notion, using a novel measure of takeover vulnerability primarily based on state legislation, we...

We investigate the effect of board gender diversity on managerial risk-taking incentives. Our results demonstrate that companies with stronger board gender diversity provide more powerful executive risk-taking incentives. It appears that female directors’ risk aversion exacerbates managers’...

Exploiting a quasi-natural experiment based on an exogenous regulatory shock, we explore the effect of board independence on customer concentration. Our difference-in-difference estimates reveal that stronger board independence raises customer concentration. Specifically, a majority of...

Exploiting a distinctive measure of corporate culture based on advanced machine learning, we investigate the effect of board gender diversity on corporate culture. Our results demonstrate that greater board gender diversity considerably strengthens positive corporate culture. The findings...