Article has an altmetric score of 1

Audit committee and firm value: Evidence on outside top executives as expert-independent directors Article

Chan, KC, Li, J. (2008). Audit committee and firm value: Evidence on outside top executives as expert-independent directors . 16(1), 16-31. 10.1111/j.1467-8683.2008.00662.x

cited authors

  • Chan, KC; Li, J

authors

abstract

  • Manuscript Type: Empirical Research Question/Issue: We examine the relation between independence of audit committee and firm value with a sample of Fortune 200 companies. Research Findings/Insights: Using a sample of Fortune 200 companies and defining top executives of other publicly traded firms as expert-independent directors and controlling for firm specifics, board features, and individual director characteristics, we find the presence of expert-independent directors on board and in the audit committee enhances firm value. Theoretical/Academic Implications: We provide empirical evidence to show that by focusing on this restricted definition of independent directors (expert-independent directors), we are able to examine independence in both the board and audit committee in a different light. Practitioner/Policy Implications: We offer new insights to relate firm value of the composition of audit committee. When expert-independent directors are of majority control of audit committee, finance-trained directors improve firm value almost five times to that of firms with independent audit committee alone. © 2008 Blackwell Publishing Ltd.

publication date

  • January 1, 2008

Digital Object Identifier (DOI)

start page

  • 16

end page

  • 31

volume

  • 16

issue

  • 1