Performance effects of appointing other firms' executive directors
AbstractThis paper studies the relationship between directorsâ€™ human capital and the companyâ€™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 InfoPaper provided by Durham University Business School in its series Working Papers with number 2011_12.
Date of creation: 01 Oct 2011
Date of revision:
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Phone: +44 (0)191 334 5200
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Web page: http://www.dur.ac.uk/business
More information through EDIRC
human capital; executive directors; non-executive directors; company performance;
Find related papers by JEL classification:
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- G39 - Financial Economics - - Corporate Finance and Governance - - - Other
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-11-14 (All new papers)
- NEP-BEC-2011-11-14 (Business Economics)
- NEP-EFF-2011-11-14 (Efficiency & Productivity)
- NEP-HRM-2011-11-14 (Human Capital & Human Resource Management)
- NEP-LAB-2011-11-14 (Labour Economics)
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