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Vigorous Boards and Cash Hoarding: Deriving Moderating Effects of Green Innovation, Agency Costs, and Independent Directors via Moment Quantile Regression

Author

Listed:
  • Dongling WANG

    (Business School, Shandong Jianzhu University, P.R, China.)

  • Syed Ghulam Meran SHAH

    (School of Social Sciences, Department of Business Administration, University of Castilla La Mancha, Cuenca, Spain)

  • Lucian IoneI CIOCA

    (Faculty of Engineering, Industrial Engineering and Management Department, Lucian Blaga University of Sibiu, Romania.)

  • Jaffar ABBAS

    (School of Media and Communication, Shanghai Jiao Tong University, P.R, China.)

Abstract

The objective of the study is to accentuate the impact of vigorous board on firms’ cash holdings. Significantly, the contributive concept of vigorous board (VGB) has been formulated employing data employment analysis (DEA), a statistical technique while embedding the specific attributes of corporate board. Specifically, Chinese listed firms have been endorsed for empirical analysis for the years 2016-2020. Empirical underpinnings substantiate that vigorous board mitigates the cash holdings. Further, innovation (INVS) and independent directors (IND) have been examined to be a deterrent for the cash holdings while agency cost (Agency) augment the cash holdings. Implicatively, the method of moment quantile regression has been executed signifying the impact of vigorous board on cash holdings for the all quantiles (10th to 90th). Conclusively, innovation and agency cost influence the cash holdings in higher quantiles (50th, 75th and 90th) while independent directors affect the cash holdings for the lower quantiles (10th, 25th and 50th). Meanwhile, the impact of State-owned enterprises (SOE) on cash holdings sustains for the all quantiles (10th to 90th). Lastly, generalized method of moment (GMM) instrumental regression has been executed which authenticates the veracity of the empirical results.

Suggested Citation

  • Dongling WANG & Syed Ghulam Meran SHAH & Lucian IoneI CIOCA & Jaffar ABBAS, 2025. "Vigorous Boards and Cash Hoarding: Deriving Moderating Effects of Green Innovation, Agency Costs, and Independent Directors via Moment Quantile Regression," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(1), pages 146-164, April.
    • Handle: RePEc:rjr:romjef:v::y:2025:i:1:p:146-164
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    More about this item

    Keywords

    Method of moment quantile regression (MMQR); Data employment analysis; Vigorous Board; Cash holdings; agency cost; innovation; independent directors;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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