{"title":"问题董事与公司风险承担","authors":"Md. Borhan Uddin Bhuiyan, Jia Liu, Ashraful Alam","doi":"10.1111/1467-8551.12770","DOIUrl":null,"url":null,"abstract":"<p>This study investigates the impact of a ‘problem director’ on the risk-taking propensity of a firm and its consequences for firm value. Analysing a sample of US companies, we find that corporate risk-taking propensity increases when a firm appoints a problem director. Our results are of economic significance, indicating that a one standard deviation increase in problem director's score leads to a 2.33% to 4.17% increase in corporate risk-taking. Mediation analysis reveals that a problem director increases firm risk-taking through reducing financial reporting quality. Further, a firm's risk-taking increases when a new problem director joins the board, and the damaging effect persists even after the problem director has left. Moreover, if a chief executive officer (CEO) is a problem director, s/he displays a greater predisposition for risk-taking. Moreover, when a problem director also sits on a board led by a problem CEO, we determine that the former will have an even greater propensity to take risks. Further analysis determines that the presence of problem directors damages long-term firm value in the aftermath of risk-taking behaviour. Overall, this study provides fresh evidence revealing a web of connections between a problem director, ineffective corporate governance and a decline in firm value.</p>","PeriodicalId":48342,"journal":{"name":"British Journal of Management","volume":null,"pages":null},"PeriodicalIF":4.5000,"publicationDate":"2023-10-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/1467-8551.12770","citationCount":"0","resultStr":"{\"title\":\"Problem Directors and Corporate Risk-Taking\",\"authors\":\"Md. Borhan Uddin Bhuiyan, Jia Liu, Ashraful Alam\",\"doi\":\"10.1111/1467-8551.12770\",\"DOIUrl\":null,\"url\":null,\"abstract\":\"<p>This study investigates the impact of a ‘problem director’ on the risk-taking propensity of a firm and its consequences for firm value. Analysing a sample of US companies, we find that corporate risk-taking propensity increases when a firm appoints a problem director. Our results are of economic significance, indicating that a one standard deviation increase in problem director's score leads to a 2.33% to 4.17% increase in corporate risk-taking. Mediation analysis reveals that a problem director increases firm risk-taking through reducing financial reporting quality. Further, a firm's risk-taking increases when a new problem director joins the board, and the damaging effect persists even after the problem director has left. Moreover, if a chief executive officer (CEO) is a problem director, s/he displays a greater predisposition for risk-taking. Moreover, when a problem director also sits on a board led by a problem CEO, we determine that the former will have an even greater propensity to take risks. Further analysis determines that the presence of problem directors damages long-term firm value in the aftermath of risk-taking behaviour. Overall, this study provides fresh evidence revealing a web of connections between a problem director, ineffective corporate governance and a decline in firm value.</p>\",\"PeriodicalId\":48342,\"journal\":{\"name\":\"British Journal of Management\",\"volume\":null,\"pages\":null},\"PeriodicalIF\":4.5000,\"publicationDate\":\"2023-10-20\",\"publicationTypes\":\"Journal Article\",\"fieldsOfStudy\":null,\"isOpenAccess\":false,\"openAccessPdf\":\"https://onlinelibrary.wiley.com/doi/epdf/10.1111/1467-8551.12770\",\"citationCount\":\"0\",\"resultStr\":null,\"platform\":\"Semanticscholar\",\"paperid\":null,\"PeriodicalName\":\"British Journal of Management\",\"FirstCategoryId\":\"91\",\"ListUrlMain\":\"https://onlinelibrary.wiley.com/doi/10.1111/1467-8551.12770\",\"RegionNum\":2,\"RegionCategory\":\"管理学\",\"ArticlePicture\":[],\"TitleCN\":null,\"AbstractTextCN\":null,\"PMCID\":null,\"EPubDate\":\"\",\"PubModel\":\"\",\"JCR\":\"Q1\",\"JCRName\":\"BUSINESS\",\"Score\":null,\"Total\":0}","platform":"Semanticscholar","paperid":null,"PeriodicalName":"British Journal of Management","FirstCategoryId":"91","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1111/1467-8551.12770","RegionNum":2,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"BUSINESS","Score":null,"Total":0}
This study investigates the impact of a ‘problem director’ on the risk-taking propensity of a firm and its consequences for firm value. Analysing a sample of US companies, we find that corporate risk-taking propensity increases when a firm appoints a problem director. Our results are of economic significance, indicating that a one standard deviation increase in problem director's score leads to a 2.33% to 4.17% increase in corporate risk-taking. Mediation analysis reveals that a problem director increases firm risk-taking through reducing financial reporting quality. Further, a firm's risk-taking increases when a new problem director joins the board, and the damaging effect persists even after the problem director has left. Moreover, if a chief executive officer (CEO) is a problem director, s/he displays a greater predisposition for risk-taking. Moreover, when a problem director also sits on a board led by a problem CEO, we determine that the former will have an even greater propensity to take risks. Further analysis determines that the presence of problem directors damages long-term firm value in the aftermath of risk-taking behaviour. Overall, this study provides fresh evidence revealing a web of connections between a problem director, ineffective corporate governance and a decline in firm value.
期刊介绍:
The British Journal of Management provides a valuable outlet for research and scholarship on management-orientated themes and topics. It publishes articles of a multi-disciplinary and interdisciplinary nature as well as empirical research from within traditional disciplines and managerial functions. With contributions from around the globe, the journal includes articles across the full range of business and management disciplines. A subscription to British Journal of Management includes International Journal of Management Reviews, also published on behalf of the British Academy of Management.