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Board independence, litigation risk, and expense stickiness: Moderating role of economic policy

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  • Li, Huxing
  • Liu, Dongming
  • Tan, Haoyu
  • Tu, Yongqian
  • Zhao, Liang

Abstract

This study examined the sample data of A-share listed companies in Shanghai and Shenzhen from 2011 to 2022 to explore the relationship between board independence, litigation risk, and expense stickiness. Findings indicate that board independence and litigation risk independently reduced corporate expense stickiness. The impact of board independence on the expense stickiness of firms varied with the degree of shareholding concentration. At a high equity concentration, board independence exhibited a strong inhibiting effect on expense stickiness. Economic policy uncertainty played a moderating role in the relationship between board independence and expense stickiness.

Suggested Citation

  • Li, Huxing & Liu, Dongming & Tan, Haoyu & Tu, Yongqian & Zhao, Liang, 2024. "Board independence, litigation risk, and expense stickiness: Moderating role of economic policy," International Review of Financial Analysis, Elsevier, vol. 96(PA).
    • Handle: RePEc:eee:finana:v:96:y:2024:i:pa:s1057521924005805
    DOI: 10.1016/j.irfa.2024.103648
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