Advanced Search
MyIDEAS: Login to save this article or follow this journal

Diversity, outside directors and firm valuation: Korean evidence

Contents:

Author Info

  • Kim, Haksoon
  • Lim, Chanwoo

Abstract

This paper examines the relationship between the diversity of independent outside directors and the valuation of Korean firms after Korea's 1998 corporate-governance reforms. First, the study finds consistent positive relationships between firm valuation and the proportion of independent outside directors with government experience, but finds negative relationships between firm valuation and the proportion of independent outside directors who are accountants. Second, the study finds that the diversity of independent outside directors' academic majors or age has consistently positive effects on firm valuation. This result implies that not only the quantity but also the quality of independent outside directors affects the valuation of Korean companies.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.sciencedirect.com/science/article/B6V7S-4W3871P-2/2/aeccefe64dd20304885b01cfe67d7ce2
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Elsevier in its journal Journal of Business Research.

Volume (Year): 63 (2010)
Issue (Month): 3 (March)
Pages: 284-291

as in new window
Handle: RePEc:eee:jbrese:v:63:y:2010:i:3:p:284-291

Contact details of provider:
Web page: http://www.elsevier.com/locate/jbusres

Related research

Keywords: Corporate-governance reform in Korea Diversity Firm valuation Human capital Independent outside directors;

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Benjamin E. Hermalin & Michael S. Weisbach, 2003. "Boards of directors as an endogenously determined institution: a survey of the economic literature," Economic Policy Review, Federal Reserve Bank of New York, Federal Reserve Bank of New York, issue Apr, pages 7-26.
  2. Mara Faccio, 2006. "Politically Connected Firms," American Economic Review, American Economic Association, American Economic Association, vol. 96(1), pages 369-386, March.
  3. Breusch, T S & Pagan, A R, 1980. "The Lagrange Multiplier Test and Its Applications to Model Specification in Econometrics," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 47(1), pages 239-53, January.
  4. Agrawal, Anup & Knoeber, Charles R, 2001. "Do Some Outside Directors Play a Political Role?," Journal of Law and Economics, University of Chicago Press, University of Chicago Press, vol. 44(1), pages 179-98, April.
  5. Moncrief, William C. & Babakus, Emin & Cravens, David W. & Johnston, Mark W., 2000. "Examining Gender Differences in Field Sales Organizations," Journal of Business Research, Elsevier, Elsevier, vol. 49(3), pages 245-257, September.
  6. Yermack, David, 1996. "Higher market valuation of companies with a small board of directors," Journal of Financial Economics, Elsevier, Elsevier, vol. 40(2), pages 185-211, February.
  7. McConnell, John J. & Servaes, Henri, 1995. "Equity ownership and the two faces of debt," Journal of Financial Economics, Elsevier, Elsevier, vol. 39(1), pages 131-157, September.
  8. Molz, Rick, 1988. "Managerial domination of boards of directors and financial performance," Journal of Business Research, Elsevier, Elsevier, vol. 16(3), pages 235-249, May.
  9. Denis, Diane K. & McConnell, John J., 2003. "International Corporate Governance," Journal of Financial and Quantitative Analysis, Cambridge University Press, Cambridge University Press, vol. 38(01), pages 1-36, March.
  10. Harvey Leibenstein, 1958. "Underemployment in Backward Economies: Some Additional Notes," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 66, pages 256.
  11. Choi, Jongmoo Jay & Park, Sae Woon & Yoo, Sean Sehyun, 2007. "The Value of Outside Directors: Evidence from Corporate Governance Reform in Korea," Journal of Financial and Quantitative Analysis, Cambridge University Press, Cambridge University Press, vol. 42(04), pages 941-962, December.
  12. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, Elsevier, vol. 3(4), pages 305-360, October.
  13. David A. Carter & Betty J. Simkins & W. Gary Simpson, 2003. "Corporate Governance, Board Diversity, and Firm Value," The Financial Review, Eastern Finance Association, Eastern Finance Association, vol. 38(1), pages 33-53, 02.
  14. Fama, Eugene F. & Jensen, Michael C., 1985. "Organizational forms and investment decisions," Journal of Financial Economics, Elsevier, Elsevier, vol. 14(1), pages 101-119, March.
  15. Morck, Randall & Shleifer, Andrei & Vishny, Robert W., 1988. "Management ownership and market valuation : An empirical analysis," Journal of Financial Economics, Elsevier, Elsevier, vol. 20(1-2), pages 293-315, January.
  16. John H Dunning, 1980. "Towards an Eclectic Theory of International Production: Some Empirical Tests," Journal of International Business Studies, Palgrave Macmillan, vol. 11(1), pages 9-31, March.
  17. Byrd, John W. & Hickman, Kent A., 1992. "Do outside directors monitor managers? *1: Evidence from tender offer bids," Journal of Financial Economics, Elsevier, Elsevier, vol. 32(2), pages 195-221, October.
  18. Vance, Stanley C., 1978. "Corporate governance: Assessing corporate performance by boardroom attributes," Journal of Business Research, Elsevier, Elsevier, vol. 6(3), pages 203-220, August.
  19. Auh, Seigyoung & Menguc, Bulent, 2006. "Diversity at the executive suite: A resource-based approach to the customer orientation-organizational performance relationship," Journal of Business Research, Elsevier, Elsevier, vol. 59(5), pages 564-572, May.
  20. McConnell, John J. & Muscarella, Chris J., 1985. "Corporate capital expenditure decisions and the market value of the firm," Journal of Financial Economics, Elsevier, Elsevier, vol. 14(3), pages 399-422, September.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Oskar Kowalewski, 2012. "Corporate Governance and Pension Fund Performance," Contemporary Economics, University of Finance and Management in Warsaw, University of Finance and Management in Warsaw, vol. 6(1), March.
  2. Rivas, Jose Luis, 2012. "Diversity & internationalization: The case of boards and TMT's," International Business Review, Elsevier, vol. 21(1), pages 1-12.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:63:y:2010:i:3:p:284-291. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.