Lead independent director, managerial risk-taking, and cost of debt: Evidence from UK

IF 3.3 Q1 BUSINESS, FINANCE

Journal of International Accounting Auditing and Taxation Pub Date : 2023-09-19 DOI:10.1016/j.intaccaudtax.2023.100576

Andrews Owusu , Frank Kwabi , Ruth Owusu-Mensah , Ahmed A Elamer

引用次数: 0

Abstract

We extend the existing literature on how the adoption of a lead independent director is related to corporate outcomes by documenting that the presence of a lead independent director on the board is significantly and negatively related to managerial risk-taking. The result is more pronounced for firms with a non-independent board chair. In a further analysis, we document that decreased managerial risk-taking leads to a reduction in the cost of debt for firms with a lead independent director on the board. Overall, our results suggest that the adoption of a lead independent director is an effective governance mechanism when the board chair is not independent, which supports the motivation of the United Kingdom corporate governance code.

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首席独立董事、管理风险和债务成本：来自英国的证据

我们通过记录首席独立董事在董事会中的存在与管理风险承担显著负相关，扩展了关于首席独立董事的任命如何与公司业绩相关的现有文献。对于拥有非独立董事会主席的公司来说，这一结果更为明显。在进一步的分析中，我们记录了管理风险的减少会降低董事会中有首席独立董事的公司的债务成本。总体而言，我们的研究结果表明，当董事会主席不独立时，采用首席独立董事是一种有效的治理机制，这支持了英国公司治理准则的动机。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Journal of International Accounting Auditing and Taxation BUSINESS, FINANCE-

CiteScore

4.50

自引率

3.80%

发文量

期刊介绍： The Journal of International Accounting, Auditing and Taxation publishes articles which deal with most areas of international accounting including auditing, taxation and management accounting. The journal''s goal is to bridge the gap between academic researchers and practitioners by publishing papers that are relevant to the development of the field of accounting. Submissions are expected to make a contribution to the accounting literature, including as appropriate the international accounting literature typically found in JIAAT and other primary US-based international accounting journals as well as in leading European accounting journals. Applied research findings, critiques of current accounting practices and the measurement of their effects on business decisions, general purpose solutions to problems through models, and essays on world affairs which affect accounting practice are all within the scope of the journal.