Governance in Executive Suites

The Harvard Law School Forum on Corporate Governance and Financial Regulation 2012-12-30

Summary:

Editor’s Note: E. Han Kim is a Professor of Finance at the University of Michigan.

In the paper, Governance in Executive Suites, which was recently made publicly available on SSRN, my co-author (Yao Lu) and I analyze the interplay between governance in executive suites and board monitoring. We find an exogenous shock increasing board independence weakens governance in executive suites. The empirical proxy for the strength of governance in executive suites is based on the governance mechanism identified by Landier et al. (2009), wherein dissenting executives steer CEOs towards more shareholder friendly decisions through “an efficient implementation constraint that disciplines the decision-making process.”

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Link:

http://blogs.law.harvard.edu/corpgov/2012/12/30/governance-in-executive-suites/

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Tags:

academic research boards of directors board independence management shocks corporate governance board monitoring e. han kim

Authors:

E. Han Kim, University of Michigan, Ross School of Business,

Date tagged:

12/30/2012, 09:44

Date published:

12/30/2012, 07:26