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Performance effects of appointing other firms' executive directors

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Author Info

  • Charlie Weir

    (Aberdeen Business School)

  • Oleksandr Talavera

    ()
    (Durham Business School)

  • Alexander Muravyev

    (IZA and St. Petersburg University GSOM)

Abstract

This paper studies the relationship between directors’ human capital and the company’s performance. In particular, we focus on the effect on performance of non-executive directors who are also executive directors in other firms. We find a positive relationship between the presence of these non-executive directors and the accounting performance of the appointing company. The effect is stronger if these directors are also executive directors at companies that are performing well. Additionally, the similarity of industry plays a role. The results support the view that appointing firms benefit from the human capital of the appointee.

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Bibliographic Info

Paper provided by Durham University Business School in its series Working Papers with number 2011_12.

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Date of creation: 01 Oct 2011
Date of revision:
Handle: RePEc:dur:durham:2011_12

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Postal: Durham University Business School, Mill Hill Lane, Durham DH1 3LB, England
Phone: +44 (0)191 334 5200
Fax: +44 (0)191 334 5201
Email:
Web page: http://www.dur.ac.uk/business
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Keywords: human capital; executive directors; non-executive directors; company performance;

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References

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