Are multiple directorships beneficial in East Asia?
We posit that the benefits and costs of multiple directorships are conditional on firm characteristics. We find firm valuation is positively associated with multiple directorships in (i) firms with high advising needs and (ii) firms with high external financing needs. These beneficial effects of multiple...
| Main Authors: | , |
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| Other Authors: | |
| Format: | Journal Article |
| Language: | English |
| Published: |
2013
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| Online Access: | https://hdl.handle.net/10356/97981 http://hdl.handle.net/10220/12283 |
| _version_ | 1811695328917716992 |
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| author | Lee, Kin-Wai Lee, Cheng-Few |
| author2 | Nanyang Business School |
| author_facet | Nanyang Business School Lee, Kin-Wai Lee, Cheng-Few |
| author_sort | Lee, Kin-Wai |
| collection | NTU |
| description | We posit that the benefits and costs of multiple directorships are conditional on
firm characteristics. We find firm valuation is positively associated with
multiple directorships in (i) firms with high advising needs and (ii) firms with
high external financing needs. These beneficial effects of multiple directorships
are generally stronger in countries with weak shareholder rights and in firms
that are widely held. However, when controlling shareholder hold high votingrights
to cash-flow rights, multiple directorships reduce firm valuation,
especially in countries with weak shareholder rights and in closely held firms.
As multiple directorships increases, cash holdings (capital expenditures)
contribute less to shareholder value. The negative association between value
of cash (capital expenditure) and busy boards is mitigated in firms with (i) high
advising needs, (ii) high external financing needs and (iii) less entrenched
ownership structures. |
| first_indexed | 2024-10-01T07:21:44Z |
| format | Journal Article |
| id | ntu-10356/97981 |
| institution | Nanyang Technological University |
| language | English |
| last_indexed | 2024-10-01T07:21:44Z |
| publishDate | 2013 |
| record_format | dspace |
| spelling | ntu-10356/979812023-05-19T06:44:41Z Are multiple directorships beneficial in East Asia? Lee, Kin-Wai Lee, Cheng-Few Nanyang Business School We posit that the benefits and costs of multiple directorships are conditional on firm characteristics. We find firm valuation is positively associated with multiple directorships in (i) firms with high advising needs and (ii) firms with high external financing needs. These beneficial effects of multiple directorships are generally stronger in countries with weak shareholder rights and in firms that are widely held. However, when controlling shareholder hold high votingrights to cash-flow rights, multiple directorships reduce firm valuation, especially in countries with weak shareholder rights and in closely held firms. As multiple directorships increases, cash holdings (capital expenditures) contribute less to shareholder value. The negative association between value of cash (capital expenditure) and busy boards is mitigated in firms with (i) high advising needs, (ii) high external financing needs and (iii) less entrenched ownership structures. 2013-07-25T07:44:22Z 2019-12-06T19:49:00Z 2013-07-25T07:44:22Z 2019-12-06T19:49:00Z 2012 2012 Journal Article Lee, K.-W., & Lee, C.-F. (2012). Are Multiple Directorships Beneficial in East Asia?. Accounting & Finance. 0810-5391 https://hdl.handle.net/10356/97981 http://hdl.handle.net/10220/12283 10.1111/acfi.12008 en Accounting & finance © 2012 The Authors. |
| spellingShingle | Lee, Kin-Wai Lee, Cheng-Few Are multiple directorships beneficial in East Asia? |
| title | Are multiple directorships beneficial in East Asia? |
| title_full | Are multiple directorships beneficial in East Asia? |
| title_fullStr | Are multiple directorships beneficial in East Asia? |
| title_full_unstemmed | Are multiple directorships beneficial in East Asia? |
| title_short | Are multiple directorships beneficial in East Asia? |
| title_sort | are multiple directorships beneficial in east asia |
| url | https://hdl.handle.net/10356/97981 http://hdl.handle.net/10220/12283 |
| work_keys_str_mv | AT leekinwai aremultipledirectorshipsbeneficialineastasia AT leechengfew aremultipledirectorshipsbeneficialineastasia |