Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/129283
Authors: 
Katolnik, Svetlana
Kukec, Sandra K.
Schöndube, Jens Robert
Year of Publication: 
2015
Series/Report no.: 
Discussion Paper, Wirtschaftswissenschaftliche Fakultät, Leibniz University of Hannover 567
Abstract: 
Efficiency of the board structure is usually perceived as linked to a higher degree of monitoring. If monitoring improves performance measurement signals, on which a manager is compensated, it can be considered desirable from the manager's point of view. As a result, having a low degree of board independence (many insiders on the board) may incentivize the board to improve its monitoring technology. However, from a dynamic perspective board monitoring is not always desirable, since it can destroy the ex ante efficient trade-off between risk and incentives under the presence of renegotiation possibility. This provides predictions for an optimal board composition seen from a dynamic perspective.
Subjects: 
Corporate governance
Board composition
Inside directors
Board incentives
JEL: 
D81
G34
M41
Document Type: 
Working Paper

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