Do Staggered Boards Harm Shareholders?

18 Pages Posted: 6 Nov 2015 Last revised: 6 May 2016

Yakov Amihud

New York University - Stern School of Business

Stoyan Stoyanov

Berkeley Research Group, LLC

Date Written: April 7, 2016

Abstract

We examine Cohen and Wang’s (JFE 2013, CW) conclusion that a staggered board (SB) lowers firm value based on the stock price reaction to two 2010 Delaware court rulings in the Airgas case, the first weakening the potency of an SB and the second restoring it. We find that CW’s results, for their sample, become insignificant after excluding a few penny stocks, or stocks with value below $10 million, or over-the-counter (non-exchange) stocks. The effects of the rulings are also insignificant for an alternative sample.

Keywords: staggered board, classified board, corporate governance, antitakeover measures

JEL Classification: G34, K22

Suggested Citation

Amihud, Yakov and Stoyanov, Stoyan, Do Staggered Boards Harm Shareholders? (April 7, 2016). Journal of Financial Economics (JFE), Forthcoming. Available at SSRN: https://ssrn.com/abstract=2686902 or http://dx.doi.org/10.2139/ssrn.2686902

Yakov Amihud (Contact Author)

New York University - Stern School of Business ( email )

44 West 4th Street
Suite 9-190
New York, NY 10012-1126
United States
212-998-0720 (Phone)
212-995-4233 (Fax)

Stoyan Stoyanov

Berkeley Research Group, LLC ( email )

Boston, MA
United States

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