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Full-Text Articles in Business
How Does Interpersonal Justice Affect Outside Directors’ Governance Behavior? A Cross-Cultural Comparison, Esther B. Del Brio, Rosa M. Hernandez-Maestro, Toru Yoshikawa
How Does Interpersonal Justice Affect Outside Directors’ Governance Behavior? A Cross-Cultural Comparison, Esther B. Del Brio, Rosa M. Hernandez-Maestro, Toru Yoshikawa
Research Collection Lee Kong Chian School of Business
We examine the impact of interpersonal justice among outside directors on the board and between a director and the CEO regarding the director’s monitoring and resource provision behaviors in different cultural contexts. We argue that directors from individualistic countries are more influenced by CEO interpersonal justice while directors from collectivistic countries are more affected by the board interpersonal justice. Our main effect results indicate that interpersonal justice with board members is positively related to both monitoring and resource provision by a director, while CEO interpersonal justice is related only to resource provision. Our results also show different effects on the …
Organisational Citizenship Behaviors Of Directors: An Integrated Framework Of Director Role-Identity And Boardroom Structure, Toru Yoshikawa, Helen Wei Hu
Organisational Citizenship Behaviors Of Directors: An Integrated Framework Of Director Role-Identity And Boardroom Structure, Toru Yoshikawa, Helen Wei Hu
Research Collection Lee Kong Chian School Of Business
While directors’ task boundaries are usually ambiguous, some of their activities or behaviors clearly constitute their formal duties, whereas others are usually perceived as organizational citizenship behavior (OCB). Applying identity theory, we present a theoretical model that demonstrates one of the key drivers for directors to engage in OCB with a focus on their role identity. We argue that an individual director’s role identity is one of the key factors that motivate directors to engage in OCB. Furthermore, we propose that two board-level contingencies, board capital, and informal board hierarchy order, can moderate the effect of directors’ role-identity salience on …
Board Diversity, Firm Risk, And Corporate Policies, Gennaro Bernile, Vineet Bhagwat, Scott Yonker
Board Diversity, Firm Risk, And Corporate Policies, Gennaro Bernile, Vineet Bhagwat, Scott Yonker
Research Collection Lee Kong Chian School Of Business
We examine the effects of diversity in the board of directors on corporate policies and risk. Using a multi-dimensional measure, we find that greater board diversity leads to lower volatility and better performance. The lower risk levels are largely due to diverse boards adopting more persistent and less risky financial policies. However, consistent with diversity fostering more efficient (real) risk-taking, firms with greater board diversity also invest persistently more in R&D and have more efficient innovation processes. Instrumental variable tests that exploit exogenous variation in firm access to the supply of diverse nonlocal directors indicate that these relations are causal.
Institutional Change Versus Resilience: A Study Of An Incorporation Of Independent Directors In Singapore Banks, Lai Si Tsui-Auch, Toru Yoshikawa
Institutional Change Versus Resilience: A Study Of An Incorporation Of Independent Directors In Singapore Banks, Lai Si Tsui-Auch, Toru Yoshikawa
Research Collection Lee Kong Chian School Of Business
We examine how Anglo-American capital market logic penetrated into Singapore where relational logic tends to guide business activities and illustrate how domestic banks reacted to this imported logic in the corporate governance field. We argue that the banks’ ability to accommodate competing logics was enhanced by state agencies’ willingness to modify Anglo-American standards to fit the local context. Given the resulting institutional ambiguities in rules, local banks, while incorporating higher outside representation on their boards, reinterpreted the meaning of independence and emphasized the resource provision role rather than the monitoring function of outside directors. The resultant institutional change has been …
Shoot For The Stars? Predicting The Recruitment Of Prestigious Directors At Newly Public Firms, Abhijith G. Acharya, Timothy G. Pollock
Shoot For The Stars? Predicting The Recruitment Of Prestigious Directors At Newly Public Firms, Abhijith G. Acharya, Timothy G. Pollock
Research Collection Lee Kong Chian School Of Business
This study explores how CEOs' and outside directors' desires for the benefits of signaling and homophily intertwine with their concerns over maintaining power and preserving local status hierarchies to affect the likelihood a firm recruits prestigious outside directors to its board. Using pooled cross-sectional data on the five years following the IPOs of 210 firms that went public between 2001 and 2004, we found that prestigious CEOs and directors viewed the recruitment of prestigious new directors differently, and that these perceptions were moderated by factors that increase the salience of risk of the potential losses to the CEO and existing …
Social Networks And Risk Taking: Evidence From Corporate Control Activities, Yen Teik Lee
Social Networks And Risk Taking: Evidence From Corporate Control Activities, Yen Teik Lee
Research Collection Lee Kong Chian School Of Business
This paper investigates the impact of social ties between the Chief Executive Officer (CEO) andboard members on corporate risk-taking in mergers and acquisitions (M&As) and on shareholdervalue. Using a measure of CEO-director connections in a large sample of U.S. firms from 2000 to2010, we document that boardroom connections lower firm acquisitiveness. If connected CEOsundertake M&As, they are less likely to choose focus acquisitions, and more likely to pay in stock.CEO-board connections do not enhance firm value in M&As. Higher levels of boardroomconnection are associated with lower announcement returns and lower subsequent return on assets.Our results are robust to alternative explanations …
The Effects Of Ownership And Capital Structure On Board Composition And Strategic Diversification In Japanese Corporations, Toru Yoshikawa, Phillip H. Phan
The Effects Of Ownership And Capital Structure On Board Composition And Strategic Diversification In Japanese Corporations, Toru Yoshikawa, Phillip H. Phan
Research Collection Lee Kong Chian School Of Business
The board of directors plays an important role in solving the agency problem between shareholders and management. This paper investigates the relationships between ownership and board structure with the diversification strategy of large Japanese firms. The results show that corporate nominee directors are associated with lower levels of product diversification of their investee firms. This suggests that nominee directors in large Japanese corporations see themselves representing specific interests and therefore investors should pay attention to board composition in order to assess the level of protection they can expect to receive. Even without any apparent agency problem with management, there remains …