Essays on board of directors composition and firm outcomes
- Autores: Raffaele Manini
- Directores de la Tesis: Oriol Amat Salas (dir. tes.), Javier Gomez Biscarri (codir. tes.)
- Lectura: En la Universitat Pompeu Fabra ( España ) en 2023
- Idioma: español
- Tribunal Calificador de la Tesis: Gaizka Ormazábal Sánchez (presid.), Mircea Epure (secret.), Andrea Polo (voc.)
- Programa de doctorado: Programa de Doctorado en Economía, Finanzas y Empresa por la Universidad Pompeu Fabra
- Materias:
- Enlaces
- Tesis en acceso abierto en: TDX
- Resumen
- español
Esta tesis se enfoca en comprender la relación entre la composición de la junta directiva y los resultados de la empresa. El Capítulo 1 investiga cómo la junta directiva de las empresas estadounidenses respondió a un cambio casi exógeno en el entorno de riesgo cibernético representado por el Reglamento General de Protección de Datos (GDPR) y encuentra que aquellas empresas que se ven más afectadas por el impacto regulatorio tienden a aumentar su enfoque sobre el riesgo cibernético, agregar más directores con experiencia cibernética en la junta y asignar con más frecuencia el monitoreo del riesgo cibernético a la junta en su conjunto o a un comité de la junta especializado. En cambio, el Capítulo 2 presenta la nueva dimensión de los conjuntos de habilidades de la junta directiva para tratar de contribuir a la literatura empírica que aborda la relación entre la composición de la junta directiva y el desempeño de la empresa. Este capítulo muestra que aquellas empresas que presentan una dimensión de ajuste de la junta directiva tanto en sus dimensiones de ajuste interno como externo se desempeñan mejor que sus pares.
- English
In this thesis I explore how US firms use one of their main corporate governance mechanisms, the board of directors’ composition, to both respond to externally imposed shift in the risk environment and to maximize their performance. In particular, this dissertation contributes to the literature examining the role of US firms board of directors’ composition and firm outcomes. Overall, my research has been influenced by scholars such as April Klein, Renee Adams, Laura Starks, and Daniel Ferreira, among others who made the exploration of the relationship between board of directors’ composition, characteristics, and firm outcomes one of their research pillars. Since the big corporate scandal of Enron in 2001, after which the regulators started calling for significant corporate governance adjustments, till today, the ESG era which advocates for higher diversity in the board of directors on the grounds of attaining greater social equality or deepening the directors’ talent pool, understanding how board of directors’ composition impacts firms’ outcomes is always a pressing question. This preface places the above research line into the two chapters that form my dissertation and are at the base of my current work in progress.
Chapter 1 of the dissertation is a joint work with April Klein and Yanting (Crystal) Shi. This work started taking shape in 2018 during my first visit in NYU and culminated into its publication on Contemporary Accounting Research in 2022. In this chapter we exploit the EU General Data Protection Regulation (GDPR) as a quasi-exogenous shock to the cyber risk environment to assess whether US board of directors changed their focus and governance structure to deal with this new challenge. The GDPR encompasses a sweeping set of regulations aimed at protecting EU citizens from unwanted uses of their personal Internet data. Although an EU regulation, the GDPR applies to all US public firms with at least one EU user. Adopting a difference-in-differences methodology, we use firms that already fall under a US data privacy regulation as a control group and find that boards of treated US firms, on average, increase their focus on cyber risk, add more directors with cyber/IT expertise, and more frequently assign cyber risk oversight to the board or to a board committee. In cross-sectional tests, we show that these changes are positively associated with a firm’s ex ante cyber risk but are unrelated to whether a firm had a large EU presence, suggesting a more global reaction to the GDPR. In addition, we examine ix some of the consequences of these board changes. We find boards that promptly responded by changing their board focus, expertise, and monitoring assignment of cyber risk around the passage of GDPR had fewer future cyberattacks/data breaches and less related media attention. Our findings suggest that, on average, American corporate boards promptly responded to changes in the cyber risk environment in ways that reduced their firms’ overall future cyber risk. Our results have implications for the efficacy and flexibility of US corporate boards to respond to unexpected changes in risk.
While Chapter 1 focuses on how US boards of directors use as one of their tools the appointment of specialized directors to face a sudden shift in a very specific aspect of their business environment, Chapter 2 (my job market paper) tries to contribute to the empirical literature addressing the relationship between boards of directors’ composition and firm performance. Exploiting the 2009 amendment to regulation S-K which requires firms to “Briefly discuss the specific experience, qualifications, attributes or skills that led to the conclusion that the person should serve as a director for the registrant at the time that the disclosure is made, in light of the registrant’s business and structure”, this chapter introduces the new concept of board of directors’ skill sets fit. This new dimension is further divided into internal and external fit where internal fit represents the appropriate combination of a diverse range of directors’ skill sets while maintaining a certain degree of complementarity and external fit represents the appropriate inclusion of directors’ skill sets to meet externally imposed challenges. Using a combination of econometric techniques to address the endogeneity concerns that usually arise within the corporate governance literature, I find that firms that present both an internal and external fit dimension perform better than their peers.
- español
