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Determinants of board and audit committee meeting frequency: Evidence from Italian companies

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  • Giulio Greco
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    Abstract

    Purpose – This purpose of this paper is to investigate the determinants of board and audit committee meeting frequency. Design/methodology/approach – The determinants studied are related to the ownership structure and to the board characteristics. The study is conducted in an agency setting featured by high ownership concentration and large insider shareholders. Hypotheses are developed based on agency theory. The empirical evidence is provided by a sample of Italian listed companies. Negative binomial regression is used in the multivariate analysis to test the relationships. Robustness checks provide further empirical support. Findings – The paper finds that insider ownership negatively impacts – either on the board or on the audit committee meeting frequency – whilst the proportion of independent directors in the board has a positive impact. This evidence is consistent with the hypothesis that insider ownership and board independent monitoring are substitute control mechanisms. The findings also show that audit committees are more active in larger firms. Originality/value – The paper provides an agency theory-based explanation of the board and the audit committee meeting frequency, in a setting featured by large controlling shareholders.

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    Bibliographic Info

    Article provided by Emerald Group Publishing in its journal Managerial Auditing Journal.

    Volume (Year): 26 (2011)
    Issue (Month): 3 (March)
    Pages: 208-229

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    Handle: RePEc:eme:majpps:v:26:y:2011:i:3:p:208-229

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    Web page: http://www.emeraldinsight.com

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    Related research

    Keywords: Audit committees; Corporate governance; Insider trading; Italy; Meetings; Shareholders;

    References

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    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.:
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    1. Collier, Paul & Gregory, Alan, 1999. "Audit committee activity and agency costs," Journal of Accounting and Public Policy, Elsevier, vol. 18(4-5), pages 311-332.
    2. Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-25, June.
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    7. Roberto Di Pietra & Christos Grambovas & Ivana Raonic & Angelo Riccaboni, 2008. "The effects of board size and ‘busy’ directors on the market value of Italian companies," Journal of Management and Governance, Springer, vol. 12(1), pages 73-91, March.
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    20. Mohd Hassan Che Haat & Rashidah Abdul Rahman & Sakthi Mahenthiran, 2008. "Corporate governance, transparency and performance of Malaysian companies," Managerial Auditing Journal, Emerald Group Publishing, vol. 23(8), pages 744-778, September.
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    Cited by:
    1. Peter Franck & Stefan Sundgren, 2012. "Determinants of internal governance quality: evidence from Sweden," Managerial Auditing Journal, Emerald Group Publishing, vol. 27(7), pages 639-665, July.

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