Finance Faculty Publications and Presentations
Document Type
Article
Publication Date
5-2021
Abstract
Highlights
- Independent directors’ dissension in board meetings plays an effective role in enhancing firm value.
- The effect varies across different levels of dissension.
Abstract
Using a novel dataset of independent directors’ voting activities on items proposed by managers of Korean firms, we investigate whether independent directors’ dissension in board meetings plays an effective role in enhancing firm value through improved corporate governance. Our results indicate that dissension improves firm value. This finding is robust to different measures of firm value and alternative model specifications including subsample, propensity score matching, and instrumental variable analyses. Overall, we contribute to the understanding of the relation between corporate governance and firm value. Specifically, we provide new evidence that the monitoring by independent directors enhances firm value.
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Publication Title
The Quarterly Review of Economics and Finance
DOI
https://doi.org/10.1016/j.qref.2021.02.003
Recommended Citation
Choi, W., Rabarison, M.K. and Wang, B., 2021. Independent directors’ dissensions and firm value. The Quarterly Review of Economics and Finance, 80, pp.258-271. https://doi.org/10.1016/j.qref.2021.02.003
Comments
Original published version available at https://doi.org/10.1016/j.qref.2021.02.003