Journal ArticleDOI
Board Supervision Capability and Information Transparency
Hsiang-Tsai Chiang,Li-Jen He +1 more
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TLDR
Wang et al. as mentioned in this paper found that among all board supervision capabilities, continuing education is the most important factor in enhancing the transparency of a firm, and they provided evidence to recommend further consideration of board compensation and continuing education to enhance board effectiveness.Abstract:
Manuscript Type: Empirical
Research Question/Issue: Board members are charged with the responsibility of supervising company operation and firm value cannot only be influenced by managers' actions, but also by those of boards of directors. Furthermore, transparency has always played an important role in corporate governance, but few studies related it to the capacity of boards of directors. Consequently, this study focuses on the capacity, compensation, and structure of boards of directors and how they relate to company transparency.
Research Findings/Insights: Using both primary and archival data from Taiwan, we find that compensation can encourage company board of directors to act in the best interests of shareholders when there is greater board independence. Among all board supervision capabilities, continuing education is the most important factor in enhancing the transparency of a firm.
Theoretical/Academic Implications: This study considers the importance of directors' compensation in corporate governance while the majority of prior studies only consider the role of management compensation. Further, the results provide additional evidence to demonstrate that board supervision capabilities may complement strong governance.
Practitioner/Policy Implications: This study offers deeper insights for policy makers to understand the influence of board of directors' impact on corporate governance. In addition, it provides evidence to recommend further consideration of director compensation and continuing education to enhance board effectiveness.read more
Citations
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Corporate governance and firm performance in emerging markets: Evidence from Turkey
TL;DR: This paper found that more concentrated ownership, often in the hands of families, led to firms performing better; concentrated ownership means that controlling families bear more of the risks of poor performance, and mechanisms that accord room for a greater range of voices and interests within and beyond families seem to also make for positive performance effects.
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Are Boards Designed to Fail? The Implausibility of Effective Board Monitoring
TL;DR: In this paper, the authors conceptualize a model based on the premise of boards as groups of individuals obtaining, processing and sharing information and explain how variation in information processing demands at the director, board and firm level may challenge effective monitoring.
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Does Board Independence Influence the Top Management Team? Evidence from Strategic Decisions toward Internationalization
TL;DR: In this article, the effects of TMT characteristics on internationalization and the moderating effect of independent directors on the internationalization relationship were examined using insights from the upper echelon perspective and agency theory.
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Family Business Performance from a Governance Perspective: A Review of Empirical Research
TL;DR: In this article, the authors provide an in-depth analysis of the family business governance system in three steps and highlight the need to contemplate the multiple relations that exist among the various governance dimensions of family firms to explain their unique performance.
Posted Content
Board Committees, CEO Compensation, and Earnings Management
Christian Laux,Volker Laux +1 more
TL;DR: In this article, the authors analyze the board of directors' equilibrium strategies for setting CEO incentive pay and overseeing financial reporting and their effects on the level of earnings management and show that an increase in CEO equity incentives does not necessarily increase earnings management because directors adjust their oversight effort in response to a change in CEO incentives.
References
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Eugene F. Fama,Michael C. Jensen +1 more
TL;DR: The authors argue that the separation of decision and risk-bearing functions observed in large corporations is common to other organizations such as large professional partnerships, financial mutuals, and nonprofits. But they do not consider the role of decision agents in these organizations.
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Information Asymmetry, Corporate Disclosure and the Capital Markets: A Review of the Empirical Disclosure Literature
TL;DR: Corporate disclosure is critical for the functioning of an efficient capital market as mentioned in this paper, and firms provide disclosure through regulated financial reports, including the financial statements, footnotes, management discussion and analysis, and other regulatory filings.
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Information asymmetry, corporate disclosure, and the capital markets: A review of the empirical disclosure literature $
Paul M. Healy,Krishna G. Palepu +1 more
TL;DR: In this article, the authors provide a framework for analyzing managers' reporting and disclosure decisions in a capital markets setting, and identify key research questions and key researchquestions, concluding that current research has generated a number of useful insights.
Journal ArticleDOI
The investment opportunity set and corporate financing, dividend, and compensation policies☆
Clifford W. Smith,Ross L. Watts +1 more
TL;DR: The authors examine explanations for corporate financing-, dividend-, and compensation-policy choices and find that contracting theories are more important in explaining cross-sectional variation in observed financial, dividend, and compensation policies than either tax-based or signaling theories.