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Evidence On The Market For Professional Directors


  • Phyllis Y. Keys
  • Joanne Li


Using the temporary increase in the supply of directors associated with successful tender offers, we examine characteristics of directors who are valuable in the market for board seats. We find that after a takeover, professional directors are three times more likely to receive new appointments than other types of directors released from their respective boards. We find that the proportion of professional directors in above-average performing targets is significantly greater than that in underperforming targets. Our results indicate that professional directors generally have valuable general human capital that more than offsets the costs of multiple directorships. 2005 The Southern Finance Association and the Southwestern Finance Association.

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  • Phyllis Y. Keys & Joanne Li, 2005. "Evidence On The Market For Professional Directors," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 28(4), pages 575-589.
  • Handle: RePEc:bla:jfnres:v:28:y:2005:i:4:p:575-589

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    Cited by:

    1. Macey, Jonathan R. & O'Hara, Maureen, 2016. "Bank corporate governance: a proposal for the post-crisis world," Economic Policy Review, Federal Reserve Bank of New York, issue Aug, pages 85-105.
    2. Benson, Bradley W. & Davidson, Wallace N. & Davidson, Travis R. & Wang, Hongxia, 2015. "Do busy directors and CEOs shirk their responsibilities? Evidence from mergers and acquisitions," The Quarterly Review of Economics and Finance, Elsevier, vol. 55(C), pages 1-19.
    3. Hunton, James E. & Rose, Jacob M., 2008. "Can directors' self-interests influence accounting choices?," Accounting, Organizations and Society, Elsevier, vol. 33(7-8), pages 783-800.
    4. Jingoo Kang, 2016. "Labor market evaluation versus legacy conservation: What factors determine retiring CEOs' decisions about long-term investment?," Strategic Management Journal, Wiley Blackwell, vol. 37(2), pages 389-405, February.
    5. Lee, Changmin, 2011. "New evidence on what happens to CEOs after they retire," Journal of Corporate Finance, Elsevier, vol. 17(3), pages 474-482, June.
    6. repec:eee:jebusi:v:92:y:2017:i:c:p:63-79 is not listed on IDEAS
    7. repec:eee:riibaf:v:41:y:2017:i:c:p:590-599 is not listed on IDEAS

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