Advanced

The impact of foreign board membership on firm value

Oxelheim, Lars LU and Randoy, T (2003) In Journal of Banking & Finance 27(12). p.2369-2392
Abstract
This study examines the effect of foreign (Anglo-American) board membership on corporate performance measured in terms of firm value (Tobin's Q). Using a sample of firms with headquarters in Norway or Sweden the study indicates a significantly higher value for firms that have outsider Anglo-American board member(s), after a variety of firm-specific and corporate governance related factors have been controlled for. We argue that this superior performance reflects the fact that these companies have successfully broken away from a partly segmented domestic capital market by "importing" an Anglo-American corporate governance system. Such an "import" signals a willingness on the part of the firm to expose itself to improved corporate governance... (More)
This study examines the effect of foreign (Anglo-American) board membership on corporate performance measured in terms of firm value (Tobin's Q). Using a sample of firms with headquarters in Norway or Sweden the study indicates a significantly higher value for firms that have outsider Anglo-American board member(s), after a variety of firm-specific and corporate governance related factors have been controlled for. We argue that this superior performance reflects the fact that these companies have successfully broken away from a partly segmented domestic capital market by "importing" an Anglo-American corporate governance system. Such an "import" signals a willingness on the part of the firm to expose itself to improved corporate governance and enhances its reputation in the financial market. (Less)
Please use this url to cite or link to this publication:
author
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
foreign board membership, cross-listing, board monitoring, corporate governance
in
Journal of Banking & Finance
volume
27
issue
12
pages
2369 - 2392
publisher
Elsevier
external identifiers
  • wos:000186487400007
  • scopus:0142118652
ISSN
1872-6372
DOI
10.1016/S0378-4266(02)00395-3
language
English
LU publication?
yes
id
3c87b897-ea9e-42eb-a462-0301f7c4eff9 (old id 899791)
date added to LUP
2008-01-15 10:12:10
date last changed
2017-09-10 03:47:53
@article{3c87b897-ea9e-42eb-a462-0301f7c4eff9,
  abstract     = {This study examines the effect of foreign (Anglo-American) board membership on corporate performance measured in terms of firm value (Tobin's Q). Using a sample of firms with headquarters in Norway or Sweden the study indicates a significantly higher value for firms that have outsider Anglo-American board member(s), after a variety of firm-specific and corporate governance related factors have been controlled for. We argue that this superior performance reflects the fact that these companies have successfully broken away from a partly segmented domestic capital market by "importing" an Anglo-American corporate governance system. Such an "import" signals a willingness on the part of the firm to expose itself to improved corporate governance and enhances its reputation in the financial market.},
  author       = {Oxelheim, Lars and Randoy, T},
  issn         = {1872-6372},
  keyword      = {foreign board membership,cross-listing,board monitoring,corporate governance},
  language     = {eng},
  number       = {12},
  pages        = {2369--2392},
  publisher    = {Elsevier},
  series       = {Journal of Banking & Finance},
  title        = {The impact of foreign board membership on firm value},
  url          = {http://dx.doi.org/10.1016/S0378-4266(02)00395-3},
  volume       = {27},
  year         = {2003},
}