The Return on Human Capital: the Case of UK Non-executive Directors that are also Executive Directors
AbstractThis paper studies the relationship between directors' human capital and the company's performance. In particular, we focus on the effect of non-executive directors who are also executive in other firms (independent executives, IE). The analysis is based on a unique dataset of publicly traded firms in the UK which we obtain by matching Extel Financial and Corporate Register data. Our results suggest a positive relationship between the presence of IE on corporate board and company performance. The effect is stronger IEs come from well performing firms. Additionally, the similarity of industries plays a role.
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Bibliographic InfoPaper provided by School of Economics, University of East Anglia, Norwich, UK. in its series University of East Anglia Applied and Financial Economics Working Paper Series with number 029.
Date of creation: 19 Jul 2011
Date of revision:
Postal: Helen Chapman, School of Economics, University of East Anglia, Norwich Research Park, Norwich, NR4 7TJ, UK
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-2011-07-27 (All new papers)
- NEP-BEC-2011-07-27 (Business Economics)
- NEP-HRM-2011-07-27 (Human Capital & Human Resource Management)
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