Abstract
This paper revisits the staggered board debate focusing on the long-term association of firm value with changes in board structure. We find no evidence that staggered board changes are negatively related to firm value. However, we find a positive relation for firms engaged in innovation and where stakeholder relationships matter more. This suggests that staggered boards promote value creation for some firms by committing the firm to undertaking long-term projects and bonding it to the relationship-specific investments of its stakeholders. Our results are robust to matching procedures and an exogenous change in Massachusetts corporate law that mandated staggered boards.
Original language | English (US) |
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Pages (from-to) | 422-444 |
Number of pages | 23 |
Journal | Journal of Financial Economics |
Volume | 126 |
Issue number | 2 |
DOIs | |
State | Published - Nov 2017 |
Keywords
- Firm value
- Innovation
- Staggered board
- Stakeholder relationships
ASJC Scopus subject areas
- Accounting
- Finance
- Economics and Econometrics
- Strategy and Management