The effectiveness of the mandatory disclosure of independent directors' opinions: Empirical evidence from China

doi:10.1016/j.jaccpubpol.2013.02.006

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	The effectiveness of the mandatory disclosure of independent directors' opinions: Empirical evidence from China
	Tang, Xuesong 1; Du, Jun 2; Hou, Qingchuan 3
刊名	JOURNAL OF ACCOUNTING AND PUBLIC POLICY
	2013-05-01
卷号	32 期号:3 页码:89-125
ISSN号	0278-4254
DOI	10.1016/j.jaccpubpol.2013.02.006
英文摘要	Since 2001, the regulatory authority of the Chinese stock market has required the independent directors of listed firms to disclose their opinions on important board decisions. Using a novel dataset of independent directors' opinions, this study examines the effectiveness of that mandatory disclosure requirement. We find that the stock market reacts negatively to announcements of independent directors saying 'no'. Firms with more severe agency problems are prone to experiencing independent directors saying 'no'. Independent directors are also more likely to say 'no' when they have multiple directorships, longer tenure, financial expertise, or live in places other than where the firms they serve are located. Consequently, firms with independent directors who say 'no' tend to experience cuts in inter-corporate lending, a lower propensity to pay dividends, reduced bank loans, and greater turnover of top executives. In addition, these firms are more likely to receive a modified audit opinion, obtain 'special treatment', or be subject to regulatory enforcement action in the year after independent directors say 'no'. Overall, the results indicate that independent directors saying 'no' can help to protect the interests of outside investors, and thus lend support to regulations mandating the disclosure of independent directors' opinions. (C) 2013 Elsevier Inc. All rights reserved.
WOS研究方向	Business & Economics ; Public Administration
语种	英语
出版者	ELSEVIER SCIENCE INC
WOS记录号	WOS:000319643600005
内容类型	期刊论文
源URL	[http://10.2.47.112/handle/2XS4QKH4/1986]
专题	上海财经大学
通讯作者	Du, Jun
作者单位	1.Southwestern Univ Finance & Econ, Sch Accounting, Chengdu, Peoples R China; 2.Hong Kong Polytech Univ, Sch Accounting & Finance, Kowloon, Hong Kong, Peoples R China; 3.Shanghai Univ Finance & Econ, Inst Accounting & Finance, Sch Accountancy, Shanghai, Peoples R China
推荐引用方式 GB/T 7714	Tang, Xuesong,Du, Jun,Hou, Qingchuan. The effectiveness of the mandatory disclosure of independent directors' opinions: Empirical evidence from China[J]. JOURNAL OF ACCOUNTING AND PUBLIC POLICY,2013,32(3):89-125.
APA	Tang, Xuesong,Du, Jun,&Hou, Qingchuan.(2013).The effectiveness of the mandatory disclosure of independent directors' opinions: Empirical evidence from China.JOURNAL OF ACCOUNTING AND PUBLIC POLICY,32(3),89-125.
MLA	Tang, Xuesong,et al."The effectiveness of the mandatory disclosure of independent directors' opinions: Empirical evidence from China".JOURNAL OF ACCOUNTING AND PUBLIC POLICY 32.3(2013):89-125.