Abstract

http://ssrn.com/abstract=2115367
 
 

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From Backroom to Boardroom: Role of Government Directors in U.S. Public Firms and Their Impact on Performance


Jun-Koo Kang


Nanyang Technological University (NTU) - Nanyang Business School

Le Zhang


University of New South Wales (UNSW) - Australian School of Business; Financial Research Network (FIRN)

December 23, 2013


Abstract:     
We examine the role of government directors (outside directors with government experience) on corporate boards. We find that their board presence does not affect the sensitivity of CEO turnover to performance. They are also more likely to miss board meetings and announcements of their appointments are greeted more negatively. Further, firms with government directors experience weaker operating performance and more negative merger announcement returns, but their mergers are less likely to be challenged by antitrust authorities. However, these adverse effects are largely alleviated when firms have high government sales, operate in regulated industries, or have politically connected government directors.

Number of Pages in PDF File: 61

Keywords: corporate governance, board of directors, board effectiveness

JEL Classification: G30, G34, J33

working papers series


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Date posted: July 23, 2012 ; Last revised: December 24, 2013

Suggested Citation

Kang , Jun-Koo and Zhang, Le, From Backroom to Boardroom: Role of Government Directors in U.S. Public Firms and Their Impact on Performance (December 23, 2013). Available at SSRN: http://ssrn.com/abstract=2115367 or http://dx.doi.org/10.2139/ssrn.2115367

Contact Information

Jun-Koo Kang
Nanyang Technological University (NTU) - Nanyang Business School ( email )
Nanyang Avenue, Block S3-01b-54
Singapore, 639798
Singapore
(+65) 6790-5662 (Phone)
(+65) 6791-3697 (Fax)
HOME PAGE: http://www.nbs.ntu.edu.sg/nbs_corporate/divisions/bnf/index.asp
Le Zhang (Contact Author)
University of New South Wales (UNSW) - Australian School of Business ( email )
School of Banking and Finance
Australian School of Business, UNSW
Sydney, NSW 2052
Australia
+61 (2) 9385 4403 (Phone)
+61 (2) 9385 6347 (Fax)
HOME PAGE: http://www.asb.unsw.edu.au/schools/Pages/LeZhang.aspx
Financial Research Network (FIRN)
C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia
HOME PAGE: http://www.firn.org.au

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