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Staggered Boards And Long-Term Firm Value, Revisited, K.J. Martijn Cremers, Lubomir P. Litov, Simone M. Sepe
Staggered Boards And Long-Term Firm Value, Revisited, K.J. Martijn Cremers, Lubomir P. Litov, Simone M. Sepe
Lubomir P. Litov
This paper revisits the staggered board debate focusing on the long-term association of firm value with
changes in board structure. We find no evidence that staggered board changes are negatively related to firm
value. However, we find a positive relation for firms engaged in innovation and where stakeholder
relationships matter more. This suggests that staggered boards promote value creation for some firms by
committing the firm to undertaking long-term projects and bonding it to the relationship-specific
investments of its stakeholders. Our results are robust to matching procedures and an exogenous change in
Massachusetts’ corporate law that mandated staggered boards.