Abstract
This study examines the role of director reputation using a sample of outside director appointments. Relative to existing literature, we focus on outside director appointments involving CEO award winners. Exploiting the award-induced change in a director’s reputation, we are able to show that investors react more positively to the appointment of outside directors they perceive as more reputable. We find that this ’reputation premium’ is approximately 2%, and robust across a range of subtests that control for a wide range of possibly confounding influences.
Original language | English |
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Journal | Finance Research Letters |
Early online date | 20 Mar 2018 |
DOIs | |
Publication status | Early online date - 20 Mar 2018 |