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Outside directors, board independence, and shareholder wealth☆
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In this article, the authors examine the wealth effects surrounding outside director appointments and find no clear evidence that outside directors of any particular occupation are more or less valuable than others, consistent with the hypothesis that outside board members are chosen in the interest of shareholders.Citations
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The Differential Effects of Classified Boards on Firm Value
Seoungpil Ahn,Keshab Shrestha +1 more
TL;DR: In this article, the authors show that the adverse impact of classified boards can be offset or even superseded by the potential benefits of board classification for firms who hope to benefit from the advisory services of their independent directors.
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Corporate Governance and Performance in the Market for Corporate Control: The Case of REITs
TL;DR: In this article, the authors examine 111 mergers and acquisitions by public U.S. Real Estate Investment Trusts (REITs) from 1997 to 2005 and find that abnormal shareholder returns are significantly positive for mergers with private targets and significantly negative for public targets.
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Impact of board characteristics on firm dividends: evidence from India
TL;DR: In this article, the authors examined the impact of board size, independence and gender diversity on firm dividend payout and whether the board characteristic-dividend payout relationship was moderated by free cash flows in the firm, and found that firms whose board characteristics signaled strong governance paid lower dividends.
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Corporate governance mechanisms and their impact on firm value
TL;DR: In this paper, the authors analyzed the impact of compliance with the Spanish Olivencia Code on the value of a firm by using panel data estimation, and concluded that the degree of compliance is more important than the mere reporting of whether firms comply or not with them, which increases the firm's value.
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The Link Between Small Business Governance and Performance: The Case of the Ghanaian SME Sector
TL;DR: In this paper, the authors examined corporate governance practices of SMEs in Ghana and whether there is any linkage between these governance practices and financial performance and found that board size, size of audit committees, corporate ethics and the proportion of outsiders on the audit committee have negative impact on financial performance while independence of the board and the presence of audit committee enhance firms' financial performance.
References
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Journal ArticleDOI
Separation of ownership and control
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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Agency Problems and the Theory of the Firm
TL;DR: In this article, the authors explain how the separation of security ownership and control, typical of large corporations, can be an efficient form of economic organization, and set aside the presumption that a corporation has owners in any meaningful sense.
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Using daily stock returns: The case of event studies
TL;DR: In this paper, the authors examine properties of daily stock returns and how the particular characteristics of these data affect event study methodologies and show that recognition of autocorrelation in daily excess returns and changes in their variance conditional on an event can sometimes be advantageous.
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Outside directors and CEO turnover
TL;DR: This article examined the relation between the monitoring of CEOs by inside and outside directors and CEO resignations using stock returns and earnings changes as measures of prior performance, and found that there is a stronger association between prior performance and the probability of a resignation.
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Two Agency-Cost Explanations of Dividends
TL;DR: In this article, the authors consider the problem of aligning managers' interests with those of investors and offer agency-cost explanations of dividends, and conclude that "these two lines of inquiry rarely meet." Yet logically any dividend policy should be designed to minimize the sum of capital, agency and taxation costs.