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Determinants of board members' financial expertise -- Empirical evidence from France

  • Jeanjean, Thomas
  • Stolowy, Hervé

Very few countries require directors to be financially literate. This article investigates the determinants of boards' financial expertise using a sample of 95 nonfinancial French listed firms. We construct a measure of financial expertise based on educational and career background data for 943 individuals occupying 1140 posts in our sample and explore the determinants of average per-firm financial expertise using a Tobit analysis. We find that average financial expertise is negatively associated with board type (two-tier versus one-tier) and growth opportunities and positively associated with board independence, ownership concentration, and institutional ownership. These findings are robust to sensitivity analyses.

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File URL: http://www.sciencedirect.com/science/article/pii/S0020-7063(09)00069-7
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Article provided by Elsevier in its journal The International Journal of Accounting.

Volume (Year): 44 (2009)
Issue (Month): 4 (December)
Pages: 378-402

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Handle: RePEc:eee:accoun:v:44:y:2009:i:4:p:378-402
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/620179

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