Independent director reputation incentives and stock price informativeness

B-Tier
Journal: Journal of Corporate Finance
Year: 2017
Volume: 47
Issue: C
Pages: 219-235

Score contribution per author:

0.670 = (α=2.01 / 3 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We link the reputation incentives of independent directors to the informativeness of stock prices. We show that when more independent directors rank a directorship high, the firm-specific information content in a firm's stock price increases. Further, independent directors with high reputation incentives serve firms that voluntarily disclose more information and display lower crash risk. We find similar results when using plausibly exogenous shocks to the reputation incentives of independent directors. Our results therefore support a causal interpretation of the positive influence that independent directors with reputation incentives exert on corporate transparency.

Technical Details

RePEc Handle
repec:eee:corfin:v:47:y:2017:i:c:p:219-235
Journal Field
Finance
Author Count
3
Added to Database
2026-01-25