BOARDS OF DIRECTORS AND SUBSTITUTION EFFECTS OF ALTERNATIVE GOVERNANCE MECHANISMS

• 成果类型: Article
• 署名作者: REDIKER, KJ; SETH, A
• 署名单位: University of Illinois System; University of Illinois Urbana-Champaign
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.4250160202
• 发表日期: 1995
• 页码: 85-99
• 关键词: Boards of directors; GOVERNANCE MECHANISMS; Agency theory

摘要

Research on the determinants and effects of various governance mechanisms typically assumes that these mechanisms operate independently. However, since a variety of mechanisms are used to achieve alignment of the interests of shareholders and managers, we propose that the level of a particular mechanism should be influenced by the levels of other mechanisms which simultaneously operate in the firm. We examine the substitution effects between alternative internal governance mechanisms for a sample of 81 bank holding companies in the postderegulation period. Specifically, we consider the relationship between monitoring by outside directors and the following mechanisms: monitoring by large outside shareholders, mutual monitoring by inside directors, and incentive effects of shareholdings by managers. Our results provide evidence consistent with the substitution hypothesis. We examine the implications of our findings for future research in the area of corporate governance.