TY - JOUR
AU1 - FERREIRA, DANIEL
AU2 - FERREIRA, MIGUEL A.
AU3 - MARIANO, BEATRIZ
AB - We find that the number of independent directors on corporate boards increases by approximately 24% following financial covenant violations in credit agreements. Most of these new directors have links to creditors. Firms that appoint new directors after violations are more likely to issue new equity, and to decrease payout, operational risk, and CEO cash compensation, than firms without such appointments. We conclude that a firm's board composition, governance, and policies are shaped by current and past credit agreements.
TI - Creditor Control Rights and Board Independence
JF - The Journal of Finance
DO - 10.1111/jofi.12692
DA - 2018-10-01
UR - https://www.deepdyve.com/lp/wiley/creditor-control-rights-and-board-independence-58x5mKZq4B
SP - 2385
EP - 2423
VL - 73
IS - 5
DP - DeepDyve
ER -