The effect of board structure on firm value: A multiple identification strategies approach using Korean data

• 成果类型: Article
• 署名作者: Black, Bernard; Kim, Woochan
• 署名单位: Northwestern University; Korea University
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2011.08.001
• 发表日期: 2012
• 页码: 203-226
• 关键词: korea; Outside directors; Audit committee; corporate governance; Board of directors

摘要

Outside directors and audit committees are widely considered to be central elements of good corporate governance. We use a 1999 Korean law as an exogenous shock to assess whether and how board structure affects firm market value. The law mandates 50% outside directors and an audit committee for large public firms, but not smaller firms. We study this shock using event study, difference-in-differences, and instrumental variable methods, within an overall regression discontinuity approach. The legal shock produces economically large share price increases for large firms, relative to mid-sized firms; their share prices jump in 1999 when the reforms are announced. (C) 2011 Elsevier B.V. All rights reserved.