Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed Companies
This paper examines the influence and causal relationship between board of directors independence, CEO duality, and firm value. By estimating multivariate regression models for panel data, unbalanced, for a sample of companies listed on the Bucharest Stock Exchange, there resulted a positive influ...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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EconJournals
2013-09-01
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| Series: | International Journal of Economics and Financial Issues |
| Online Access: | https://www.econjournals.com/index.php/ijefi/article/view/598 |
| _version_ | 1797921461770387456 |
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| author | Georgeta Vintila Stefan Cristian Gherghina |
| author_facet | Georgeta Vintila Stefan Cristian Gherghina |
| author_sort | Georgeta Vintila |
| collection | DOAJ |
| description |
This paper examines the influence and causal relationship between board of directors independence, CEO duality, and firm value. By estimating multivariate regression models for panel data, unbalanced, for a sample of companies listed on the Bucharest Stock Exchange, there resulted a positive influence of the percentage of independent directors on firm value, but down to a threshold of their representation of 47.23 percent, whereupon their influence becomes negative. When we employed fixed-effects models, the relationship previously mentioned was not statistically validated. However, the results provide support for a lack of statistically significant relationship between the percentage of non-executive directors and firm value. Besides, by estimating fixed-effects models we found a positive influence of CEO duality on industry-adjusted Tobin’s Q ratio, but not statistically significant when estimating models without cross-sectional effects. The causal relationships between board independence and firm value identified based on Granger causality are not robust.
Keywords: independent directors; non-executive directors; firm value; panel data regression models; Granger causality; vector autoregression
JEL Classifications: G32; G34
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| first_indexed | 2024-04-10T14:16:24Z |
| format | Article |
| id | doaj.art-525c3d592a6c4412ac51cc431b1632ff |
| institution | Directory Open Access Journal |
| issn | 2146-4138 |
| language | English |
| last_indexed | 2024-04-10T14:16:24Z |
| publishDate | 2013-09-01 |
| publisher | EconJournals |
| record_format | Article |
| series | International Journal of Economics and Financial Issues |
| spelling | doaj.art-525c3d592a6c4412ac51cc431b1632ff2023-02-15T16:09:30ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382013-09-0134Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed CompaniesGeorgeta Vintila0Stefan Cristian Gherghina1The Bucharest University of Economic StudiesThe Bucharest University of Economic Studies This paper examines the influence and causal relationship between board of directors independence, CEO duality, and firm value. By estimating multivariate regression models for panel data, unbalanced, for a sample of companies listed on the Bucharest Stock Exchange, there resulted a positive influence of the percentage of independent directors on firm value, but down to a threshold of their representation of 47.23 percent, whereupon their influence becomes negative. When we employed fixed-effects models, the relationship previously mentioned was not statistically validated. However, the results provide support for a lack of statistically significant relationship between the percentage of non-executive directors and firm value. Besides, by estimating fixed-effects models we found a positive influence of CEO duality on industry-adjusted Tobin’s Q ratio, but not statistically significant when estimating models without cross-sectional effects. The causal relationships between board independence and firm value identified based on Granger causality are not robust. Keywords: independent directors; non-executive directors; firm value; panel data regression models; Granger causality; vector autoregression JEL Classifications: G32; G34 https://www.econjournals.com/index.php/ijefi/article/view/598 |
| spellingShingle | Georgeta Vintila Stefan Cristian Gherghina Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed Companies International Journal of Economics and Financial Issues |
| title | Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed Companies |
| title_full | Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed Companies |
| title_fullStr | Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed Companies |
| title_full_unstemmed | Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed Companies |
| title_short | Board of Directors Independence and Firm Value: Empirical Evidence Based on the Bucharest Stock Exchange Listed Companies |
| title_sort | board of directors independence and firm value empirical evidence based on the bucharest stock exchange listed companies |
| url | https://www.econjournals.com/index.php/ijefi/article/view/598 |
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