This paper analyzes the economic rationale for board regulation in place and for introducing new regulation in the future. We relate the value of the firm to the use of employee directors, board independence, directors with multiple seats, and to gender diversity. Our evidence shows that the...

We ask when and how a diverse board can benefit shareholders. Board diversity may be value-increasing even if some directors have agendas that are not perfectly aligned with shareholders' interests. Diversity commits the board to a high information standard because directors with opposing...

Boards of directors face the twin task of disciplining and screening executives. To perform these tasks directors do not have detailed information about executives' behaviour, and only infrequently have information about the success or failure of initiated strategies, reorganizations, mergers...

Regulators, proxy advisors and shareholders are regularly calling for independent directors. However, at the same time, independent directors commonly engage in numerous outside activities potentially reducing their time and commitment with the particular firm. Using Tobin's Q as an...

We study, for the first time, whether and how directors' and officers' (D&O) insurance affects independent directors' voting. We provide new evidence that D&O insurance through the insurance channel and the insurance-monitoring channel incentivizes independent directors to monitor. The positive...

We model a corporate board evaluating a CEO of uncertain management ability. Each director receives a noisy private signal about CEO ability, after which directors discuss this ability and vote to retain or replace the CEO. Directors care about true CEO ability, since it affects their equity...

This paper examines the role of bank representatives on the firm's board of directors and their influence on risk and managerial compensation. After the firm has taken on debt for a big-scale lump-sum investment project, the bank representatives are inclined to lower the project risk, which is...

This paper investigates how board gender diversity (BGD) impacts information asymmetry (IA) and investment efficiency (IE), in addition to the moderating role of board gender diversity on the nexus between information asymmetry and investment efficiency in Egypt, motivated by the unclear lens...

The agency problem at the core of corporate law stems from a chronic potential conflict of interest between directors' self-interest and that of shareholders. Corporate law views directors' self-interest in terms of diverting welfare to directors at the expense of shareholders. Another component...

Large outside shareholders, outside boards, and management entrenchment influence the choice of inside or outside CEOs. In a sample of 385 CEO changes from 1979 to 1986, the probability of selecting an outside CEO rises with the level of stock ownership of large outside shareholders and the...