How Much Do Directors Influence Firm Value?

• 成果类型: Article
• 署名作者: Burt, Aaron; Hrdlicka, Christopher; Harford, Jarrad
• 署名单位: University of Oklahoma System; University of Oklahoma - Norman; University of Washington; University of Washington Seattle
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhz068
• 发表日期: 2020
• 页码: 1818
• 关键词: INTERLOCKS; governance; SPREAD

摘要

The value a director provides to a firm is empirically difficult to establish. We estimate that value by exploiting the commonality in idiosyncratic returns of firms linked by a director and show that, on average, a director's influence causes variation in firm value of almost 1% per year. The return commonality is not due to industry or other observable economic links. Variation in the availability of information on shared directors and a placebo test exploiting the timing of shared directors provide further identification. The results also imply that the directorial labor market does not fully assess directors in real time.