Director tenure diversity and board monitoring effectiveness
This study examines the impact of director tenure diversity on board effectiveness. We find that tenure-diverse boards exhibit significantly higher CEO performance-turnover sensitivity and that firms with tenure-diverse audit committees are less likely to experience accounting restatements. Furtherm...
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sg-smu-ink.soa_research-26572020-01-21T15:00:21Z Director tenure diversity and board monitoring effectiveness LI, Na WAHID, Aida Sijamic This study examines the impact of director tenure diversity on board effectiveness. We find that tenure-diverse boards exhibit significantly higher CEO performance-turnover sensitivity and that firms with tenure-diverse audit committees are less likely to experience accounting restatements. Furthermore, we document that tenure-diverse compensation committees also award less excess compensation and are less likely to overcompensate. Even though tenure-diverse boards seem to exhibit superior monitoring performance, there is limited evidence that their firms exhibit superior financial performance. The findings suggest that recent calls for board renewal, to the extent that it would increase tenure diversity rather than just decrease average board tenure, may help enhance board monitoring. 2018-09-01T07:00:00Z text application/pdf https://ink.library.smu.edu.sg/soa_research/1630 info:doi/10.1111/1911-3846.12332 https://ink.library.smu.edu.sg/context/soa_research/article/2657/viewcontent/Director_Tenure_Diversity_2018_May_pp.pdf http://creativecommons.org/licenses/by-nc-nd/4.0/ Research Collection School Of Accountancy eng Institutional Knowledge at Singapore Management University Corporate governance director tenure board tenure board composition board diversity CEO turnover restatement Accounting Corporate Finance |
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Corporate governance director tenure board tenure board composition board diversity CEO turnover restatement Accounting Corporate Finance LI, Na WAHID, Aida Sijamic Director tenure diversity and board monitoring effectiveness |
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This study examines the impact of director tenure diversity on board effectiveness. We find that tenure-diverse boards exhibit significantly higher CEO performance-turnover sensitivity and that firms with tenure-diverse audit committees are less likely to experience accounting restatements. Furthermore, we document that tenure-diverse compensation committees also award less excess compensation and are less likely to overcompensate. Even though tenure-diverse boards seem to exhibit superior monitoring performance, there is limited evidence that their firms exhibit superior financial performance. The findings suggest that recent calls for board renewal, to the extent that it would increase tenure diversity rather than just decrease average board tenure, may help enhance board monitoring. |
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text |
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LI, Na WAHID, Aida Sijamic |
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LI, Na WAHID, Aida Sijamic |
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LI, Na |
title |
Director tenure diversity and board monitoring effectiveness |
title_short |
Director tenure diversity and board monitoring effectiveness |
title_full |
Director tenure diversity and board monitoring effectiveness |
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Director tenure diversity and board monitoring effectiveness |
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Director tenure diversity and board monitoring effectiveness |
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director tenure diversity and board monitoring effectiveness |
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Institutional Knowledge at Singapore Management University |
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2018 |
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https://ink.library.smu.edu.sg/soa_research/1630 https://ink.library.smu.edu.sg/context/soa_research/article/2657/viewcontent/Director_Tenure_Diversity_2018_May_pp.pdf |
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