Podcast
Questions and Answers
Board characteristics can have a significant impact on firm performance.
Board characteristics can have a significant impact on firm performance.
True
Corporate Governance codes and legislation assume that certain board characteristics, such as independence or gender distribution, positively affect board work and firm performance.
Corporate Governance codes and legislation assume that certain board characteristics, such as independence or gender distribution, positively affect board work and firm performance.
True
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
True
The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
Signup and view all the answers
Gender diverse boards allocate more effort to monitoring
Gender diverse boards allocate more effort to monitoring
Signup and view all the answers
Female directors have better attendance records than male directors
Female directors have better attendance records than male directors
Signup and view all the answers
Gender diversity of the board reduces firm profitability
Gender diversity of the board reduces firm profitability
Signup and view all the answers
Gender diversity only increases value when additional board monitoring would enhance firm value
Gender diversity only increases value when additional board monitoring would enhance firm value
Signup and view all the answers
Forcing firms to appoint more female directors decreased the firm value Q
Forcing firms to appoint more female directors decreased the firm value Q
Signup and view all the answers
Loss in the firm value was caused by the sex of the new board members
Loss in the firm value was caused by the sex of the new board members
Signup and view all the answers
Eckbo et al. (2022) criticize results by Ahern and Dittmar (2012)
Eckbo et al. (2022) criticize results by Ahern and Dittmar (2012)
Signup and view all the answers
Criminal convictions of directors, CEOs, and CFOs are likely to reflect on negative behavioral attributes such as overconfidence
Criminal convictions of directors, CEOs, and CFOs are likely to reflect on negative behavioral attributes such as overconfidence
Signup and view all the answers
Firms require a criminal record check or similar checks of unethical behavior on candidates for board membership
Firms require a criminal record check or similar checks of unethical behavior on candidates for board membership
Signup and view all the answers
If directors and other executives with crime convictions are overconfident, the business outcomes for the firm will be positive
If directors and other executives with crime convictions are overconfident, the business outcomes for the firm will be positive
Signup and view all the answers
Relationship between firm performance and board size is linear.
Relationship between firm performance and board size is linear.
Signup and view all the answers
Firms' optimal governance structures are influenced solely by their business models.
Firms' optimal governance structures are influenced solely by their business models.
Signup and view all the answers
Governance structures arise endogenously as firms choose them in response to governance issues they face.
Governance structures arise endogenously as firms choose them in response to governance issues they face.
Signup and view all the answers
Endogeneity issues may arise due to factors influencing governance attributes and firm performance.
Endogeneity issues may arise due to factors influencing governance attributes and firm performance.
Signup and view all the answers
More rigorous theoretical analyses and econometric techniques can address endogeneity.
More rigorous theoretical analyses and econometric techniques can address endogeneity.
Signup and view all the answers
Market reaction to managers' sudden deaths can impact stock market response and labor contracts.
Market reaction to managers' sudden deaths can impact stock market response and labor contracts.
Signup and view all the answers
Blockholders' deaths cannot affect firm value or ownership structure.
Blockholders' deaths cannot affect firm value or ownership structure.
Signup and view all the answers
Stock price reactions to blockholders' deaths do not reflect their effect on governance.
Stock price reactions to blockholders' deaths do not reflect their effect on governance.
Signup and view all the answers
The number of independent directors on a board is often recommended and poses no problems related to incentives and competence.
The number of independent directors on a board is often recommended and poses no problems related to incentives and competence.
Signup and view all the answers
Outside directors may have different risk preferences and lack competence, leading to potential issues in board decision-making.
Outside directors may have different risk preferences and lack competence, leading to potential issues in board decision-making.
Signup and view all the answers
Appointing outside directors to improve board diversity cannot lead to competence issues.
Appointing outside directors to improve board diversity cannot lead to competence issues.
Signup and view all the answers
Linck et al. have studied determinants of board characteristics, highlighting the challenges related to independent directors.
Linck et al. have studied determinants of board characteristics, highlighting the challenges related to independent directors.
Signup and view all the answers
Smaller and less independent boards are found in firms with high growth opportunities, R&D expenditures, and stock return volatility.
Smaller and less independent boards are found in firms with high growth opportunities, R&D expenditures, and stock return volatility.
Signup and view all the answers
Large firms tend to have smaller and less independent boards due to their complex business models.
Large firms tend to have smaller and less independent boards due to their complex business models.
Signup and view all the answers
Combining CEO and Chairman of the Board (COB) posts is common in large firms and when the CEO is older and has had a longer tenure.
Combining CEO and Chairman of the Board (COB) posts is common in large firms and when the CEO is older and has had a longer tenure.
Signup and view all the answers
Various board characteristics, such as independent directors, board size, gender distribution, equity incentives, and criminal convictions, have been studied in relation to firm performance.
Various board characteristics, such as independent directors, board size, gender distribution, equity incentives, and criminal convictions, have been studied in relation to firm performance.
Signup and view all the answers
There is evidence that increasing the proportion of independent directors leads to better firm performance in low-profitability firms.
There is evidence that increasing the proportion of independent directors leads to better firm performance in low-profitability firms.
Signup and view all the answers
Larger boards are more effective in monitoring due to coordination challenges and free-rider problems.
Larger boards are more effective in monitoring due to coordination challenges and free-rider problems.
Signup and view all the answers
Empirical evidence suggests a positive relationship between board size and firm value, financial ratios, and CEO retention after poor performance.
Empirical evidence suggests a positive relationship between board size and firm value, financial ratios, and CEO retention after poor performance.
Signup and view all the answers
There is a positive relationship between board size and operating performance of small unlisted firms.
There is a positive relationship between board size and operating performance of small unlisted firms.
Signup and view all the answers
The relationship between board size and industry-adjusted returns on assets varies for small unlisted Finnish firms.
The relationship between board size and industry-adjusted returns on assets varies for small unlisted Finnish firms.
Signup and view all the answers
CEO duality, where the CEO also serves as the board chairperson, is a topic of mixed empirical evidence.
CEO duality, where the CEO also serves as the board chairperson, is a topic of mixed empirical evidence.
Signup and view all the answers
CEO duality can foster greater operational efficiency and improve internal communication from and to the board, depending on the firm's characteristics and directors.
CEO duality can foster greater operational efficiency and improve internal communication from and to the board, depending on the firm's characteristics and directors.
Signup and view all the answers
CEO duality can lead to conflict elimination and more time for the CEO to run the company.
CEO duality can lead to conflict elimination and more time for the CEO to run the company.
Signup and view all the answers
Overconfident management can lead to poor business decisions and reduced profits.
Overconfident management can lead to poor business decisions and reduced profits.
Signup and view all the answers
The dataset contains information on criminal convictions for all Swedish citizens since 1974.
The dataset contains information on criminal convictions for all Swedish citizens since 1974.
Signup and view all the answers
Convictions range from traffic offenses to fraud and other dishonest acts.
Convictions range from traffic offenses to fraud and other dishonest acts.
Signup and view all the answers
A non-trivial proportion of board members, CEOs, and CFOs in Swedish listed firms have criminal convictions.
A non-trivial proportion of board members, CEOs, and CFOs in Swedish listed firms have criminal convictions.
Signup and view all the answers
Board members with dishonest behavior are more likely to be males than females.
Board members with dishonest behavior are more likely to be males than females.
Signup and view all the answers
The board of directors is responsible for hiring and firing a CEO.
The board of directors is responsible for hiring and firing a CEO.
Signup and view all the answers
CEO turnover is positively related to annual earnings decreases and negative stock price behavior.
CEO turnover is positively related to annual earnings decreases and negative stock price behavior.
Signup and view all the answers
Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting.
Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting.
Signup and view all the answers
Firms with criminally convicted or suspected directors and CEOs are smaller, less profitable, and report more volatile earnings.
Firms with criminally convicted or suspected directors and CEOs are smaller, less profitable, and report more volatile earnings.
Signup and view all the answers
Studies have shown that CEO turnover is related to negative performance surprises.
Studies have shown that CEO turnover is related to negative performance surprises.
Signup and view all the answers
CEO turnover is negatively related to annual earnings decreases and negative stock price behavior.
CEO turnover is negatively related to annual earnings decreases and negative stock price behavior.
Signup and view all the answers
Board members with dishonest behavior are more likely to be females than males.
Board members with dishonest behavior are more likely to be females than males.
Signup and view all the answers
Board characteristics have no influence on firm performance according to empirical evidence.
Board characteristics have no influence on firm performance according to empirical evidence.
Signup and view all the answers
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Signup and view all the answers
The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
Signup and view all the answers
Corporate Governance codes and legislation often assume that certain board characteristics, such as independence or gender distribution, affect positively board work and consequent firm performance.
Corporate Governance codes and legislation often assume that certain board characteristics, such as independence or gender distribution, affect positively board work and consequent firm performance.
Signup and view all the answers
Having a greater gender diversity of the board reduces firm profitability
Having a greater gender diversity of the board reduces firm profitability
Signup and view all the answers
Appointing female directors may expand diverse opinions in board meetings and improve board decision making
Appointing female directors may expand diverse opinions in board meetings and improve board decision making
Signup and view all the answers
The change in Norwegian law requiring 40% of directors to be women was motivated by a desire to improve firm performance
The change in Norwegian law requiring 40% of directors to be women was motivated by a desire to improve firm performance
Signup and view all the answers
Forcing firms to appoint more female directors decreased the firm value Q
Forcing firms to appoint more female directors decreased the firm value Q
Signup and view all the answers
Convicted directors, CEOs, and CFOs are likely to reflect negative behavioral attributes such as overconfidence
Convicted directors, CEOs, and CFOs are likely to reflect negative behavioral attributes such as overconfidence
Signup and view all the answers
Firms sometimes appoint and promote individuals who may be incompetent, narcissistic, and manipulative to top managerial positions
Firms sometimes appoint and promote individuals who may be incompetent, narcissistic, and manipulative to top managerial positions
Signup and view all the answers
Criminal convictions, regardless of the nature or seriousness of the crime, may reflect on an individual's negative behavioral attributes
Criminal convictions, regardless of the nature or seriousness of the crime, may reflect on an individual's negative behavioral attributes
Signup and view all the answers
Firms do not require a criminal record check or similar checks of unethical behavior on candidates for board membership
Firms do not require a criminal record check or similar checks of unethical behavior on candidates for board membership
Signup and view all the answers
Studies suggest that CEO turnover is related to negative performance surprises
Studies suggest that CEO turnover is related to negative performance surprises
Signup and view all the answers
The dataset contains information on criminal convictions for all Swedish citizens since 1974
The dataset contains information on criminal convictions for all Swedish citizens since 1974
Signup and view all the answers
Gender diversity has negative effects on the performance of companies with strong shareholder rights
Gender diversity has negative effects on the performance of companies with strong shareholder rights
Signup and view all the answers
Gender diversity has beneficial effects on the performance of companies with weak shareholder rights
Gender diversity has beneficial effects on the performance of companies with weak shareholder rights
Signup and view all the answers
Corporate Governance and Firm Performance: The relationship between firm performance and board size is linear.
Corporate Governance and Firm Performance: The relationship between firm performance and board size is linear.
Signup and view all the answers
Corporate Governance and Firm Performance: Governance structures arise endogenously as firms choose them in response to governance issues they face.
Corporate Governance and Firm Performance: Governance structures arise endogenously as firms choose them in response to governance issues they face.
Signup and view all the answers
Corporate Governance and Firm Performance: More rigorous theoretical analyses and econometric techniques cannot address endogeneity.
Corporate Governance and Firm Performance: More rigorous theoretical analyses and econometric techniques cannot address endogeneity.
Signup and view all the answers
Corporate Governance and Firm Performance: Market reaction to managers' sudden deaths cannot impact stock market response and labor contracts.
Corporate Governance and Firm Performance: Market reaction to managers' sudden deaths cannot impact stock market response and labor contracts.
Signup and view all the answers
Corporate Governance and Firm Performance: Stock price reactions to blockholders' deaths do not reflect their effect on governance and potential for takeovers.
Corporate Governance and Firm Performance: Stock price reactions to blockholders' deaths do not reflect their effect on governance and potential for takeovers.
Signup and view all the answers
Corporate Governance and Firm Performance: The number of independent directors on a board is always recommended and poses no problems related to incentives and competence.
Corporate Governance and Firm Performance: The number of independent directors on a board is always recommended and poses no problems related to incentives and competence.
Signup and view all the answers
Corporate Governance and Firm Performance: Outside directors may have different risk preferences and lack competence, leading to potential issues in board decision-making.
Corporate Governance and Firm Performance: Outside directors may have different risk preferences and lack competence, leading to potential issues in board decision-making.
Signup and view all the answers
Corporate Governance and Firm Performance: Appointing outside directors to improve board diversity cannot lead to competence issues.
Corporate Governance and Firm Performance: Appointing outside directors to improve board diversity cannot lead to competence issues.
Signup and view all the answers
Corporate Governance and Firm Performance: Linck et al. have not studied determinants of board characteristics, highlighting the challenges related to independent directors.
Corporate Governance and Firm Performance: Linck et al. have not studied determinants of board characteristics, highlighting the challenges related to independent directors.
Signup and view all the answers
Corporate Governance and Firm Performance: Firms' optimal governance structures are influenced solely by their business models.
Corporate Governance and Firm Performance: Firms' optimal governance structures are influenced solely by their business models.
Signup and view all the answers
Corporate Governance and Firm Performance: Endogeneity issues may arise due to factors influencing governance attributes and firm performance.
Corporate Governance and Firm Performance: Endogeneity issues may arise due to factors influencing governance attributes and firm performance.
Signup and view all the answers
Corporate Governance and Firm Performance: The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
Corporate Governance and Firm Performance: The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
Signup and view all the answers
Smaller and less independent boards are found in firms with high growth opportunities, R&D expenditures, and stock return volatility.
Smaller and less independent boards are found in firms with high growth opportunities, R&D expenditures, and stock return volatility.
Signup and view all the answers
Combining CEO and Chairman of the Board (COB) posts is common in large firms and when the CEO is older and has had a longer tenure.
Combining CEO and Chairman of the Board (COB) posts is common in large firms and when the CEO is older and has had a longer tenure.
Signup and view all the answers
Low-profitability firms tend to increase the proportion of independent directors, but there is no evidence that this strategy leads to better firm performance.
Low-profitability firms tend to increase the proportion of independent directors, but there is no evidence that this strategy leads to better firm performance.
Signup and view all the answers
Larger boards are less effective in monitoring due to coordination challenges and free-rider problems.
Larger boards are less effective in monitoring due to coordination challenges and free-rider problems.
Signup and view all the answers
There is a negative relationship between board size and firm value, financial ratios, and CEO retention after poor performance.
There is a negative relationship between board size and firm value, financial ratios, and CEO retention after poor performance.
Signup and view all the answers
CEO duality, where the CEO also serves as the board chairperson, is a topic of mixed empirical evidence, with potential benefits for operational efficiency and internal communication.
CEO duality, where the CEO also serves as the board chairperson, is a topic of mixed empirical evidence, with potential benefits for operational efficiency and internal communication.
Signup and view all the answers
CEO duality can lead to conflict elimination and more time for the CEO to run the company.
CEO duality can lead to conflict elimination and more time for the CEO to run the company.
Signup and view all the answers
The relationship between board size and industry-adjusted returns on assets varies for small unlisted Finnish firms.
The relationship between board size and industry-adjusted returns on assets varies for small unlisted Finnish firms.
Signup and view all the answers
CEO duality can also lead to clear separation from management, clear authority to speak on behalf of the board, conflict elimination, and more time for the CEO to run the company.
CEO duality can also lead to clear separation from management, clear authority to speak on behalf of the board, conflict elimination, and more time for the CEO to run the company.
Signup and view all the answers
There is a direct positive correlation between board size and firm performance.
There is a direct positive correlation between board size and firm performance.
Signup and view all the answers
Empirical evidence suggests a positive relationship between board size and firm value, financial ratios, and CEO retention after poor performance.
Empirical evidence suggests a positive relationship between board size and firm value, financial ratios, and CEO retention after poor performance.
Signup and view all the answers
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Signup and view all the answers
Criminal convictions of board members, CEOs, and CFOs in Swedish listed firms are not associated with smaller, less profitable, and more volatile earnings.
Criminal convictions of board members, CEOs, and CFOs in Swedish listed firms are not associated with smaller, less profitable, and more volatile earnings.
Signup and view all the answers
Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting.
Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting.
Signup and view all the answers
CEO turnover is not positively related to annual earnings decreases and negative stock price behavior.
CEO turnover is not positively related to annual earnings decreases and negative stock price behavior.
Signup and view all the answers
Board members with dishonest behavior are more likely to be males than females.
Board members with dishonest behavior are more likely to be males than females.
Signup and view all the answers
The board of directors is not responsible for hiring and firing a CEO.
The board of directors is not responsible for hiring and firing a CEO.
Signup and view all the answers
Studies have shown that CEO turnover is not related to negative performance surprises.
Studies have shown that CEO turnover is not related to negative performance surprises.
Signup and view all the answers
Firms with criminally convicted or suspected directors and CEOs are not smaller, less profitable, and do not report more volatile earnings.
Firms with criminally convicted or suspected directors and CEOs are not smaller, less profitable, and do not report more volatile earnings.
Signup and view all the answers
Gender diversity of the board does not reduce firm profitability.
Gender diversity of the board does not reduce firm profitability.
Signup and view all the answers
CEO duality, where the CEO also serves as the board chairperson, has mixed empirical evidence.
CEO duality, where the CEO also serves as the board chairperson, has mixed empirical evidence.
Signup and view all the answers
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Signup and view all the answers
Overconfident management cannot lead to poor business decisions and reduced profits.
Overconfident management cannot lead to poor business decisions and reduced profits.
Signup and view all the answers
Appointing outside directors to improve board diversity cannot lead to competence issues.
Appointing outside directors to improve board diversity cannot lead to competence issues.
Signup and view all the answers
Optimal board characteristics have a direct positive correlation with firm performance according to empirical evidence.
Optimal board characteristics have a direct positive correlation with firm performance according to empirical evidence.
Signup and view all the answers
Corporate Governance codes and legislation often assumes that certain board characteristics, such as independence or gender distribution, affect positively board work and consequent firm performance.
Corporate Governance codes and legislation often assumes that certain board characteristics, such as independence or gender distribution, affect positively board work and consequent firm performance.
Signup and view all the answers
The relationship between board size and firm performance is linear.
The relationship between board size and firm performance is linear.
Signup and view all the answers
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Increasing a firm's board characteristics is empirically expected to lead to an increase in the firm's performance.
Signup and view all the answers
True or false: The relationship between firm performance and board size is linear
True or false: The relationship between firm performance and board size is linear
Signup and view all the answers
True or false: Firms' optimal governance structures are influenced solely by their business models
True or false: Firms' optimal governance structures are influenced solely by their business models
Signup and view all the answers
True or false: Governance structures arise endogenously as firms choose them in response to governance issues they face
True or false: Governance structures arise endogenously as firms choose them in response to governance issues they face
Signup and view all the answers
True or false: Endogeneity issues may arise due to factors influencing governance attributes and firm performance
True or false: Endogeneity issues may arise due to factors influencing governance attributes and firm performance
Signup and view all the answers
True or false: More rigorous theoretical analyses and econometric techniques can address endogeneity
True or false: More rigorous theoretical analyses and econometric techniques can address endogeneity
Signup and view all the answers
True or false: Market reaction to managers' sudden deaths can impact stock market response and labor contracts
True or false: Market reaction to managers' sudden deaths can impact stock market response and labor contracts
Signup and view all the answers
True or false: Blockholders' deaths can affect firm value, ownership structure, and corporate governance
True or false: Blockholders' deaths can affect firm value, ownership structure, and corporate governance
Signup and view all the answers
True or false: Stock price reactions to blockholders' deaths reflect their effect on governance and potential for takeovers
True or false: Stock price reactions to blockholders' deaths reflect their effect on governance and potential for takeovers
Signup and view all the answers
True or false: The number of independent directors on a board is always recommended and poses no problems related to incentives and competence
True or false: The number of independent directors on a board is always recommended and poses no problems related to incentives and competence
Signup and view all the answers
True or false: Outside directors may have different risk preferences and lack competence, leading to potential issues in board decision-making
True or false: Outside directors may have different risk preferences and lack competence, leading to potential issues in board decision-making
Signup and view all the answers
True or false: Appointing outside directors to improve board diversity may lead to competence issues
True or false: Appointing outside directors to improve board diversity may lead to competence issues
Signup and view all the answers
True or false: Linck et al. have studied determinants of board characteristics, highlighting the challenges related to independent directors
True or false: Linck et al. have studied determinants of board characteristics, highlighting the challenges related to independent directors
Signup and view all the answers
Smaller boards are more effective in monitoring due to coordination challenges and free-rider problems
Smaller boards are more effective in monitoring due to coordination challenges and free-rider problems
Signup and view all the answers
Increasing the proportion of independent directors in low-profitability firms leads to better firm performance
Increasing the proportion of independent directors in low-profitability firms leads to better firm performance
Signup and view all the answers
There is a positive relationship between board size and firm value, financial ratios, and CEO retention after poor performance
There is a positive relationship between board size and firm value, financial ratios, and CEO retention after poor performance
Signup and view all the answers
CEO duality, where the CEO also serves as the board chairperson, has consistent empirical evidence supporting potential benefits for operational efficiency and internal communication
CEO duality, where the CEO also serves as the board chairperson, has consistent empirical evidence supporting potential benefits for operational efficiency and internal communication
Signup and view all the answers
The relationship between board size and industry-adjusted returns on assets is consistent for small unlisted Finnish firms
The relationship between board size and industry-adjusted returns on assets is consistent for small unlisted Finnish firms
Signup and view all the answers
Appointing female directors may lead to expansion of diverse opinions in board meetings and improved decision making
Appointing female directors may lead to expansion of diverse opinions in board meetings and improved decision making
Signup and view all the answers
CEO turnover is negatively related to annual earnings decreases and negative stock price behavior
CEO turnover is negatively related to annual earnings decreases and negative stock price behavior
Signup and view all the answers
Governance structures arise endogenously as firms choose them in response to governance issues they face
Governance structures arise endogenously as firms choose them in response to governance issues they face
Signup and view all the answers
Gender diverse boards allocate more effort to monitoring
Gender diverse boards allocate more effort to monitoring
Signup and view all the answers
Market reaction to managers' sudden deaths can impact stock market response and labor contracts
Market reaction to managers' sudden deaths can impact stock market response and labor contracts
Signup and view all the answers
Corporate Governance codes and legislation assume that certain board characteristics, such as independence or gender distribution, positively affect board work and firm performance
Corporate Governance codes and legislation assume that certain board characteristics, such as independence or gender distribution, positively affect board work and firm performance
Signup and view all the answers
Loss in firm value was caused by the sex of the new board members
Loss in firm value was caused by the sex of the new board members
Signup and view all the answers
Overconfident management can lead to poor business decisions and reduced profits.
Overconfident management can lead to poor business decisions and reduced profits.
Signup and view all the answers
A non-trivial proportion of board members, CEOs, and CFOs in Swedish listed firms have criminal convictions.
A non-trivial proportion of board members, CEOs, and CFOs in Swedish listed firms have criminal convictions.
Signup and view all the answers
Board members with dishonest behavior are more likely to be males than females.
Board members with dishonest behavior are more likely to be males than females.
Signup and view all the answers
Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting.
Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting.
Signup and view all the answers
The board of directors is responsible for hiring and firing a CEO.
The board of directors is responsible for hiring and firing a CEO.
Signup and view all the answers
CEO turnover is positively related to annual earnings decreases and negative stock price behavior.
CEO turnover is positively related to annual earnings decreases and negative stock price behavior.
Signup and view all the answers
Studies have shown that CEO turnover is related to negative performance surprises.
Studies have shown that CEO turnover is related to negative performance surprises.
Signup and view all the answers
Firms with criminally convicted or suspected directors and CEOs are smaller, less profitable, and report more volatile earnings.
Firms with criminally convicted or suspected directors and CEOs are smaller, less profitable, and report more volatile earnings.
Signup and view all the answers
CEO duality, where the CEO also serves as the board chairperson, has mixed empirical evidence.
CEO duality, where the CEO also serves as the board chairperson, has mixed empirical evidence.
Signup and view all the answers
Forcing firms to appoint more female directors decreased the firm value.
Forcing firms to appoint more female directors decreased the firm value.
Signup and view all the answers
The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
The example given in the text suggests that there is a direct positive correlation between board size and firm performance.
Signup and view all the answers
Gender diversity of the board reduces firm profitability.
Gender diversity of the board reduces firm profitability.
Signup and view all the answers
Having a greater gender diversity on the board can lead to improved decision making and monitoring efforts.
Having a greater gender diversity on the board can lead to improved decision making and monitoring efforts.
Signup and view all the answers
Gender-diverse boards are more likely to allocate more effort to monitoring.
Gender-diverse boards are more likely to allocate more effort to monitoring.
Signup and view all the answers
According to Adams and Ferreira (2009), gender diversity of the board has a positive effect on firm profitability.
According to Adams and Ferreira (2009), gender diversity of the board has a positive effect on firm profitability.
Signup and view all the answers
The effect of gender diversity on firm performance may be influenced by the strength of shareholder rights.
The effect of gender diversity on firm performance may be influenced by the strength of shareholder rights.
Signup and view all the answers
The change in Norwegian law requiring 40% of directors to be women was primarily motivated by a desire to improve firms' performance.
The change in Norwegian law requiring 40% of directors to be women was primarily motivated by a desire to improve firms' performance.
Signup and view all the answers
According to Ahern and Dittmar (2012), forcing firms to appoint more female directors led to a decrease in firm value.
According to Ahern and Dittmar (2012), forcing firms to appoint more female directors led to a decrease in firm value.
Signup and view all the answers
The decrease in firm value due to the appointment of more female directors was not caused by their gender, but by their younger age and lack of high-level work experience.
The decrease in firm value due to the appointment of more female directors was not caused by their gender, but by their younger age and lack of high-level work experience.
Signup and view all the answers
Eckbo et al. (2022) criticize the results of Ahern and Dittmar (2012) and argue that the negative market reaction was allocated to the wrong event.
Eckbo et al. (2022) criticize the results of Ahern and Dittmar (2012) and argue that the negative market reaction was allocated to the wrong event.
Signup and view all the answers
According to Eckbo et al. (2022), the pool of qualified female directors was deep enough to avoid significant shareholder-borne costs of the quota.
According to Eckbo et al. (2022), the pool of qualified female directors was deep enough to avoid significant shareholder-borne costs of the quota.
Signup and view all the answers
Convicted directors, CEOs, and CFOs are likely to reflect negative behavioral attributes such as overconfidence, according to Amir, Kallunki, and Nilsson (2014).
Convicted directors, CEOs, and CFOs are likely to reflect negative behavioral attributes such as overconfidence, according to Amir, Kallunki, and Nilsson (2014).
Signup and view all the answers
Firms do not require a criminal record check or similar checks of unethical behavior on candidates for board membership.
Firms do not require a criminal record check or similar checks of unethical behavior on candidates for board membership.
Signup and view all the answers
If directors and other executives with crime convictions are overconfident, it may lead to poor business outcomes for the firm.
If directors and other executives with crime convictions are overconfident, it may lead to poor business outcomes for the firm.
Signup and view all the answers
Study Notes
Criminal Convictions and Corporate Governance
- Overconfident management can lead to poor business decisions and reduced profits
- Study conducted on all firms listed on the Swedish stock market from 1999-2007
- Dataset contains information on criminal convictions for all Swedish citizens since 1974
- Information includes individuals found guilty by a court of law or receiving summary punishments
- Convictions range from traffic offenses to fraud and other dishonest acts
- A non-trivial proportion of board members, CEOs, and CFOs in Swedish listed firms have criminal convictions
- Firms with criminally convicted or suspected directors and CEOs are smaller, less profitable, and report more volatile earnings
- Board members with dishonest behavior are more likely to be males than females
- Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting
- The board of directors is responsible for hiring and firing a CEO
- CEO turnover is positively related to annual earnings decreases and negative stock price behavior
- Studies have shown that CEO turnover is related to negative performance surprises
Criminal Convictions and Corporate Governance
- Overconfident management can lead to poor business decisions and reduced profits
- Study conducted on all firms listed on the Swedish stock market from 1999-2007
- Dataset contains information on criminal convictions for all Swedish citizens since 1974
- Information includes individuals found guilty by a court of law or receiving summary punishments
- Convictions range from traffic offenses to fraud and other dishonest acts
- A non-trivial proportion of board members, CEOs, and CFOs in Swedish listed firms have criminal convictions
- Firms with criminally convicted or suspected directors and CEOs are smaller, less profitable, and report more volatile earnings
- Board members with dishonest behavior are more likely to be males than females
- Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting
- The board of directors is responsible for hiring and firing a CEO
- CEO turnover is positively related to annual earnings decreases and negative stock price behavior
- Studies have shown that CEO turnover is related to negative performance surprises
Criminal Convictions and Corporate Governance
- Overconfident management can lead to poor business decisions and reduced profits
- Study conducted on all firms listed on the Swedish stock market from 1999-2007
- Dataset contains information on criminal convictions for all Swedish citizens since 1974
- Information includes individuals found guilty by a court of law or receiving summary punishments
- Convictions range from traffic offenses to fraud and other dishonest acts
- A non-trivial proportion of board members, CEOs, and CFOs in Swedish listed firms have criminal convictions
- Firms with criminally convicted or suspected directors and CEOs are smaller, less profitable, and report more volatile earnings
- Board members with dishonest behavior are more likely to be males than females
- Appointing dishonest individuals to boards of directors can lead to lower profits, excessive risk, and lower quality reporting
- The board of directors is responsible for hiring and firing a CEO
- CEO turnover is positively related to annual earnings decreases and negative stock price behavior
- Studies have shown that CEO turnover is related to negative performance surprises
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Related Documents
Description
Test your knowledge on the impact of criminal convictions on corporate governance with this quiz. Explore the findings of a study on Swedish listed firms and the correlation between board members' criminal history and company performance. Delve into the repercussions of appointing dishonest individuals to key positions and the relationship between CEO turnover and financial outcomes.
