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Reexamining staggered boards and shareholder value

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  • Cohen, Alma
  • Wang, Charles C.Y.

Abstract

Cohen and Wang (2013) (CW2013) provide evidence consistent with market participants perceiving staggered boards to be value reducing. Amihud and Stoyanov (2016) (AS2016) contests these findings, reporting some specifications under which the results are not statistically significant. We show that the results retain their significance under a wide array of robustness tests that address the concerns expressed by AS2016. Our empirical findings reinforce the conclusions of CW2013.

Suggested Citation

  • Cohen, Alma & Wang, Charles C.Y., 2017. "Reexamining staggered boards and shareholder value," Journal of Financial Economics, Elsevier, vol. 125(3), pages 637-647.
    • Handle: RePEc:eee:jfinec:v:125:y:2017:i:3:p:637-647
    DOI: 10.1016/j.jfineco.2017.06.004
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    References listed on IDEAS

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    1. Jonathan B. Cohn & Stuart L. Gillan & Jay C. Hartzell, 2016. "On Enhancing Shareholder Control: A (Dodd-) Frank Assessment of Proxy Access," Journal of Finance, American Finance Association, vol. 71(4), pages 1623-1668, August.
    2. Bebchuk, Lucian A. & Cohen, Alma, 2005. "The costs of entrenched boards," Journal of Financial Economics, Elsevier, vol. 78(2), pages 409-433, November.
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    6. Bo Becker & Daniel Bergstresser & Guhan Subramanian, 2013. "Does Shareholder Proxy Access Improve Firm Value? Evidence from the Business Roundtable's Challenge," Journal of Law and Economics, University of Chicago Press, vol. 56(1), pages 127-160.
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    Cited by:

    1. Fang, Lily & Huang, Sterling, 2024. "The governance of director compensation," Journal of Financial Economics, Elsevier, vol. 155(C).
    2. Tim Baldenius & Xiaojing Meng & Lin Qiu, 2021. "The value of board commitment," Review of Accounting Studies, Springer, vol. 26(4), pages 1587-1622, December.
    3. Zhang, Shuran, 2021. "Directors’ career concerns: Evidence from proxy contests and board interlocks," Journal of Financial Economics, Elsevier, vol. 140(3), pages 894-915.
    4. Chen, I-Ju & Hsu, Po-Hsuan & Wang, Yanzhi, 2022. "Staggered boards and product innovations: Evidence from Massachusetts State Bill HB 5640," Research Policy, Elsevier, vol. 51(4).

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    More about this item

    Keywords

    Corporate governance; Staggered boards; Takeover defense; Antitakeover provisions; Firm value; Delaware; Airgas;
    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
    • K22 - Law and Economics - - Regulation and Business Law - - - Business and Securities Law

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