The role of board dynamics in explaining payout policy and shareholders’ wealth: Evidence from the banking sector in Africa

Ofori‐Sasu, Daniel; Dzeha, Gloria Clarissa; Boachie, Christopher; Abor, Joshua Yindenaba

doi:10.1016/j.resglo.2022.100086

Cited by 5 publications

(2 citation statements)

References 30 publications

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“…In examining CEOboard dynamics, Graham et al (2020) show that board independence increases at CEO turnover and falls with CEO tenure, with the decline stronger following superior performance. Ofori-Sasu et al (2022) discuss that payout policy can be used as a substitute control device in the presence of board dynamics to protect shareholders' wealth. Therefore, we expect that the characteristics of the board, such as dynamics and potentials, are likely to reduce the agent-principal conflict of interest by preparing more comparable financial reports and improving investment efficiency.…”

Section: Introductionmentioning

confidence: 99%

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The effect of board effectiveness on the long-term company success and comparability of financial information

Salehi,

Hassanzadeh

2024

MRR

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Purpose This study aims to investigate the effect of the dynamics and potential of the board of directors on investment efficiency and the comparability of financial information in companies listed on the Tehran Stock Exchange. Design/methodology/approach The number of observations for this study includes 1,218 observations from companies listed on the Tehran Stock Exchange during 2014–2020. The authors used econometric statistical methods such as multiple linear regression, the Chow and Hausman test and the Kendall correlation coefficient using Eviews software to conduct the research. To measure the board’s effectiveness, two variables are used, including board dynamics and potential. Findings The results showed a positive and significant relationship between dynamics, board potential and investment efficiency. Also, no significant relationship was observed between the board dynamics and the comparability of financial information. Finally, a positive and significant relationship exists between the board’s potential and the comparability of financial information. Originality/value The importance of this research is the use of board proxies, including the dynamics and potential of the board. In addition, other variables of board characteristics, such as size, independence, ownership and gender, and the relationship between these variables with investment efficiency and comparability of financial information, have been examined in this study.

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Section: Introductionmentioning

confidence: 99%

“…(2020) show that board independence increases at CEO turnover and falls with CEO tenure, with the decline stronger following superior performance. Ofori-Sasu et al. (2022) discuss that payout policy can be used as a substitute control device in the presence of board dynamics to protect shareholders’ wealth.…”

Section: Introductionmentioning

confidence: 99%