CEO Marital Status and Insider Trading

Abstract

We investigate the association between chief executive officers' (CEOs') marital status and their tendency to profit from insider trading. We argue that marriage can constrain CEOs' opportunistic behaviour, which could increase litigation risk, and show that married CEOs earn lower insider trading returns compared to unmarried CEOs. Insider trades can be identified as either routine or opportunistic. We also find that married CEOs are less likely to engage in opportunistic trades, and they earn lower insider trading returns in firms with weaker corporate governance and higher information asymmetry. Our empirical results remain robust after accounting for several endogeneity tests.

Co-opted Boards and Corporate Cash Holdings

“…In this section, we examine the potential moderating role of alternative governance mechanisms in the relationship between board co-option and cash holdings. Following the literature (Al Mamun et al, 2020;Baghdadi et al, 2020;Hegde et al, 2022) (Chen et al, 2015). Finally, the effect of board independence on cash has been extensively studied; in fact, most papers that study corporate governance use board independence as a proxy (e.g., Harford, Mansi, and Maxwell, 2008).…”

Is Marriage a Turning Point? Evidence from Cash Holdings Behaviour

“…Our results show that single-CEO firms are more prone to agency problems. 2019), insider trading (Hegde et al, 2022) and dividend policy (Hossain et al, 2023).…”