When does ownership matter? Board characteristics and behavior
We develop a contingency approach to explain how firm ownership influences the monitoring function of the board—measured as the magnitude of external audit fees contracted by the board—by extending agency theory to incorporate the resource dependence notion that boards have distinct incentives and a...
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| Veröffentlicht in: | Strategic management journal 2013-07, Vol.34 (7), p.823-842 |
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| container_end_page | 842 |
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| container_issue | 7 |
| container_start_page | 823 |
| container_title | Strategic management journal |
| container_volume | 34 |
| creator | DESENDER, KURT A. AGUILERA, RUTH V. CRESPI, RAFEL GARCÍA-CESTONA, MIGUEL |
| description | We develop a contingency approach to explain how firm ownership influences the monitoring function of the board—measured as the magnitude of external audit fees contracted by the board—by extending agency theory to incorporate the resource dependence notion that boards have distinct incentives and abilities to monitor management. Analyses of data on Continental European companies reveal that while board independence and audit services are complementary when ownership is dispersed, this is not the case when ownership is concentrated—suggesting that ownership concentration and board composition become substitutes in terms of monitoring management. Additional analysis shows that the relationship between board composition and external audit fees is also contingent upon the type of the controlling shareholder. |
| doi_str_mv | 10.1002/smj.2046 |
| format | Article |
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Board characteristics and behavior</title><title>Strategic management journal</title><addtitle>Strat. Mgmt. J</addtitle><description>We develop a contingency approach to explain how firm ownership influences the monitoring function of the board—measured as the magnitude of external audit fees contracted by the board—by extending agency theory to incorporate the resource dependence notion that boards have distinct incentives and abilities to monitor management. Analyses of data on Continental European companies reveal that while board independence and audit services are complementary when ownership is dispersed, this is not the case when ownership is concentrated—suggesting that ownership concentration and board composition become substitutes in terms of monitoring management. 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Board characteristics and behavior</atitle><jtitle>Strategic management journal</jtitle><addtitle>Strat. Mgmt. J</addtitle><date>2013-07</date><risdate>2013</risdate><volume>34</volume><issue>7</issue><spage>823</spage><epage>842</epage><pages>823-842</pages><issn>0143-2095</issn><eissn>1097-0266</eissn><coden>SMAJD8</coden><abstract>We develop a contingency approach to explain how firm ownership influences the monitoring function of the board—measured as the magnitude of external audit fees contracted by the board—by extending agency theory to incorporate the resource dependence notion that boards have distinct incentives and abilities to monitor management. Analyses of data on Continental European companies reveal that while board independence and audit services are complementary when ownership is dispersed, this is not the case when ownership is concentrated—suggesting that ownership concentration and board composition become substitutes in terms of monitoring management. 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| fulltext | fulltext |
| identifier | ISSN: 0143-2095 |
| ispartof | Strategic management journal, 2013-07, Vol.34 (7), p.823-842 |
| issn | 0143-2095 1097-0266 |
| language | eng |
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| source | Jstor Complete Legacy; Wiley Online Library Journals Frontfile Complete |
| subjects | Agency theory audit Audit fees Auditing board of directors Boards of directors Business audits Business management Business ownership Business structures Chief executive officers Corporate governance Economic incentives Europe Fees Financial audits Management audits Management theory Monitoring Ownership ownership structure Shareholders Stockholders Strategic management Studies |
| title | When does ownership matter? Board characteristics and behavior |
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