Board Overlap, Seat Accumulation, and Share Prices

40 Pages Posted: 14 Jun 2001  

Urs Peyer

INSEAD - Finance

Claudio F. Loderer

University of Berne - Institute for Financial Management; European Corporate Governance Institute (ECGI)

Multiple version iconThere are 2 versions of this paper

Date Written: September 5, 2001

Abstract

We examine the board overlap among firms listed in Switzerland. Collusion, managerial entrenchment, and financial participation cannot explain it. The overlap appears to be induced by banks and by the accumulation of seats by the most popular directors. We also document that seat accumulation is negatively related to firm value, possibly because of the conflicts of interest that multiple directorships induce and the time constraints that directors face. Contrary to popular beliefs, however, the directors of traded firms do not generally hold more than one mandate in other traded firms. They do, however, hold multiple seats in nontraded firms.

Suggested Citation

Peyer, Urs and Loderer, Claudio F., Board Overlap, Seat Accumulation, and Share Prices (September 5, 2001). EFMA 2001 Lugano Meetings. Available at SSRN: https://ssrn.com/abstract=273465 or http://dx.doi.org/10.2139/ssrn.273465

Urs C. Peyer

INSEAD - Finance ( email )

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Claudio F. Loderer (Contact Author)

University of Berne - Institute for Financial Management ( email )

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Bern, CH-3012
Switzerland
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+41 31 631 84 21 (Fax)

European Corporate Governance Institute (ECGI) ( email )

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Belgium

HOME PAGE: http://www.ecgi.org

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