Creditor Control Rights and Board Independence

• 成果类型: Article
• 署名作者: Ferreira, Daniel; Ferreira, Miguel A.; Mariano, Beatriz
• 署名单位: University of London; London School Economics & Political Science; Center for Economic & Policy Research (CEPR); European Corporate Governance Institute; Universidade Nova de Lisboa; City St Georges, University of London
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/jofi.12692
• 发表日期: 2018
• 页码: 2385-2423
• 关键词: CORPORATE GOVERNANCE; LOAN COVENANTS; Debt covenants; determinants; APPOINTMENTS; conflicts; DIRECTORS; Managers; equity; size

摘要

We find that the number of independent directors on corporate boards increases by approximately 24% following financial covenant violations in credit agreements. Most of these new directors have links to creditors. Firms that appoint new directors after violations are more likely to issue new equity, and to decrease payout, operational risk, and CEO cash compensation, than firms without such appointments. We conclude that a firm's board composition, governance, and policies are shaped by current and past credit agreements.