Does Board Composition Matter to Institutional Investors?
Material type: TextDescription: 238S-266S pSubject(s): In: GANGOPADHYAY, SHUBHASIS JOURNAL OF EMERGING MARKET FINANCESummary: This study examines the resource dependency and signalling role of independent directors from the perspective of institutional investor’s and also investigates if the presence of large blockholder moderates the signalling effect. This study uses the quasi-natural experiment to examine this relationship. The difference-in-difference (DiD) analysis of 5,298 firm observations covering 618 National Stock Exchange (NSE) listed Indian firms for the period 2001–2011 provides empirical evidence that board composition does matter to institutional investors. We find that non-compliant firms who adopted the board independence requirement experience a significant increase in institutional ownership relative to previously compliant firms. We also find that institutional investors have invested more in family-owned firms during post-mandate period compared to government-, private- and foreign-owned firms. Overall, this study contributes to the existing literature on resource dependency theory and signalling theory and shows that the board independence acts as a signal to institutional investors and decreases the agency cost and cost of monitoring.Item type | Current library | Call number | Vol info | Status | Notes | Date due | Barcode | Item holds | |
---|---|---|---|---|---|---|---|---|---|
Journal Article | Main Library | Vol 18, No 2S/ 55511089JA4 (Browse shelf(Opens below)) | Available | 55511089JA4 | |||||
Journals and Periodicals | Main Library On Display | JOURNAL/FIN/Vol 18, No 2S/55511089 (Browse shelf(Opens below)) | Vol 18, No 2S (01/11/2019) | Not for loan | August, 2019 | 55511089 |
Browsing Main Library shelves Close shelf browser (Hides shelf browser)
No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | No cover image available | ||
Vol 18, No 2/ 55514013 COMPLIMENTARY | Vol 18, No 2S/ 55511089JA2 ‘Indian Stock Market Volatility’: A Study of Inter-linkages and Spillover Effects | Vol 18, No 2S/ 55511089JA3 Price and Volatility Linkages Between Indian Stocks and Their European GDRs | Vol 18, No 2S/ 55511089JA4 Does Board Composition Matter to Institutional Investors? | Vol 18, No 3/ 55510830JA1 Does Government Deficit Crowd Out Private Investment? An Empirical Analysis for National and Sub-National Governments | Vol 18, No 3/ 55510830JA2 Monetary Policy Transmission in India: Interest Rate Puzzle | Vol 18, No 3/ 55510830JA3 Optimal Resource Allocation for SQM: A Comparative Case Study in Pharmaceutical Industry |
This study examines the resource dependency and signalling role of independent directors from the perspective of institutional investor’s and also investigates if the presence of large blockholder moderates the signalling effect. This study uses the quasi-natural experiment to examine this relationship. The difference-in-difference (DiD) analysis of 5,298 firm observations covering 618 National Stock Exchange (NSE) listed Indian firms for the period 2001–2011 provides empirical evidence that board composition does matter to institutional investors. We find that non-compliant firms who adopted the board independence requirement experience a significant increase in institutional ownership relative to previously compliant firms. We also find that institutional investors have invested more in family-owned firms during post-mandate period compared to government-, private- and foreign-owned firms. Overall, this study contributes to the existing literature on resource dependency theory and signalling theory and shows that the board independence acts as a signal to institutional investors and decreases the agency cost and cost of monitoring.
There are no comments on this title.