Bankers on Board and Conditional Conservatism: Evidence from an Information Shock

Posted: 15 Jan 2013 Last revised: 12 Nov 2015

See all articles by Pietro Bonetti

Pietro Bonetti

University of Padova

Elisabetta Ipino

Concordia University, Quebec

Antonio Parbonetti

University of Padua

Date Written: May 1, 2015

Abstract

We exploit an informational shock to the firm information environment to examine the relationship between unaffiliated bankers on corporate boards and conditional conservatism. We find that after the information shock, firms with unaffiliated bankers on board experience a statistically and economically significant increase in conditional conservatism relative to firms without unaffiliated bankers on board. These findings hold after we account for other country-level factors that shape the demand for conditional conservatism. We further document that the role of bankers on conditional conservatism depends on firm-specific incentives arising from the contracting environment. Taken together, our results provide new insights into the role of corporate governance arrangements on financial reporting outcomes.

Keywords: Accounting Conservatism, Corporate Governance, Bankers on Boards

JEL Classification: G30, M41

Suggested Citation

Bonetti, Pietro and Ipino, Elisabetta and Parbonetti, Antonio, Bankers on Board and Conditional Conservatism: Evidence from an Information Shock (May 1, 2015). Available at SSRN: https://ssrn.com/abstract=2200532 or http://dx.doi.org/10.2139/ssrn.2200532

Pietro Bonetti

University of Padova ( email )

Italy

Elisabetta Ipino (Contact Author)

Concordia University, Quebec ( email )

1455 de Maisonneuve Blvd. W.
Montreal, Quebec H3G 1MB
Canada

Antonio Parbonetti

University of Padua ( email )

Via del Santo 33
Padova, 35123
Italy
+39 049 8274261 (Phone)

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