Board of directors and top management team. CEO relative power and financial returns in Brazil

Beatriz Schalka, gilberto sarfati
DOI: https://doi.org/10.21529/RECADM.2014023

Texto completo:

Artigo

Resumo

This article investigates if companies with a stricter control and monitoring system perform better than others in Brazil. The works compares 116 companies in respect to the their independence level between top management team and board directors– being that measured by four parameters, namely, the percentage of independent outsiders in the board, the separation of CEO and chairman, the adoption of contingent compensation and the percentage of institutional investors in the ownership structure – and their financial return measured in terms return on assets (ROA) from the latest Quarterly Earnings release of 2012. Two variables (percentage of outside directors and percentage of institutional investor ownership) are significant in the regression. This paper has provided evidences that the increase in the formal governance structure trough outside directors in the board and ownership by institutional investor might actually lead to worse performance.


Palavras-chave

Corporate governance; control; board of directors


Referências


Aggarwal, R. K., & Samwick, A. A. (1999). The other side of the trade-off: The impact of risk on executive compensation. Journal of Political Economy, (107), 65-104.

Anderson, D. W., Melanson, S. J., & Maly, J. (2007). The evolution of corporate overnance: Power redistribution brings board to life. Corporate Governance: An International Review, (15), 780–797.

Bavly, D. (1985). What is board good for? Long Range Planning, 19(3), 20-26.

Beatty, R., & Zajac, E. (1994). Managerial incentives, monitoring, and risk bearing: a study of executive compensation, ownership and board structure in initial public offering. Administrative Quarterly Science, 39(2), 313-335.

BM&F. (2011). Perguntas Frequentes BM&F. Retrieved May 21, 2012, from http://www.bmfbovespa.com.br/empresas/pages/empresas_perguntas-frequentes.asp#3

Borokhovic, K., & Parrino, R. (1996). Outside directors and CEO selection. Journal of Finacial and Quantitative Analysis, (31), 337-355.

Cai, J., Liu, Y., & Qian, Y. (2002). Information asymmetry and corporate governance. Academy of Management Review, (90), 430-467.

Carpenter, M. A., & Sanders, W. M. G. (2002). Top management team compensation: The missing link between CEO pay and firm performance? Strategic Management Journal, (23), 367–375.

Caixe, D. F., & Krauter, E. (2013). A influência da estrutura de propriedade e controle sobre o valor de mercado corporativo no Brasil. Revista Contabilidade & Finanças, 24(62), 142-153.

Castro, C. B., De La Concha, M. D., Gravel, J. V. & Periñan, M. M. V. (2009), Does the Team Leverage the Board's Decisions?. Corporate Governance: An International Review, (17), 744–761.

Claessens, S., & Burcin Y. (2013). Corporate Governance in Emerging Markets: A Survey. Emerging Markets Review, (15), 1-33.

Clark, R. C. (1986). Corporate Law. Boston: Little Brown.

Dalton, D. R., Hitt, M. A., Certo, S. T., & Dalton, C. M. (2007). The fundamental agency problem and its mitigation. In J. P. Walsh & A. P. Brief (Eds.), Academy of Management Annals, (pp. 1-64). New York: Erlbaum.

Daily, C. M., Dalton, D. R., & Canella, A. (2003). Corporate governance: decades of dialogue and data. Academy of Management Review, (28), 371-382.

Eisenhardt, K. (1989). Agency theory: an assessment and review. Academy of Management Review, (14), 54-74.

Fama, E. (Apr. de 1980). Agency Problems and the Theory of the Firm. Journal of Political Economy, (88), 288-307.

Fama, E., & Jensen, M. (1983). Separation of Ownership and Control. Journal of Law and Economics, (26), 301-325.

Fich, E., & Shivdasanti, A. (2006). Are busy boards effective monitors? The Journal of Finance, 71(2), 689-724.

Finkelstein, S., & D´Aveni, R. (1994). CEO duality as a double-edged sword: how boards of directors balance entrenchment avoidance and unity of command. The Academy of Management Journal, 37(5), 1079-1108.

Hart, O. (1995). Corporate governance: some theory and implications. The Economic Journal, 105: 678-689.

He, J., & Huang, Z. (2011) Board Informal Hierarchy and Firm Financial Performance: Exploring a Tacit Structure Guiding Boardroom Interactions. Academy of Management Journal, 54 (6): 1119-1139.

Huse, M. (2007). Boards, governance and value creation. Cambridge, U.K: Cambridge University Press.

Jensen, M. C. (1993). The modern industrial revolution: exit, and the failure of internal control systems. The Journal of Finance, (48), 831-880.

Jensen, M., & Meckling, W. (1976). Theory of the firm: managerial behaviorm agency costs and owership structure. Journal of Financial Economics, (3), 305-360.

Klein. (1998). Firm performance and board committee structure. Jounal of Law & Economics, (41), 275-303.

Lan, L. L. & Heracleous, L. (2010) Rethinking agency theory: the view from law. Academy of Management Review, 35(2), 294-314.

Langevoort, D. C. (2001). The human nature of corporate boards: law, norms and the unintended consequences of independence and accountability. Georgetown Law Journal, (89), 797- 832.

Marcel, J. J. & Cowen, A. P. (2014), Cleaning house or jumping ship? Understanding board upheaval following financial fraud. Strategic Management Journal 35: 926–937.

Macus, M. 2008. Board capability. International Studies of Management and Organization, 38: 98–116.

Nowak, M. J., & McCabe, M. (2003). Information costs and the role of the indepedent director. Coporate Governance, 11: 300-307.

Nyberg, A. J., Fulmer, I.S., Gerhart, B., & Carpenter, M.A. (2010). Agency Theory Revisited: CEO Return and Shareholder Interest Alignment. Academy of Management Journal, 53(5): 1029-1049.

Okimura, R. T., Silveira, A. M. da, & Rocha, K. C. (2007). Estrutura de propriedade e desempenho corporativo no Brasil. RAC-Eletrônica, 1(1): 119-135.

Oliveira Neto.J.C.C., Medeiros, O.R. & Queiroz, T. B. (2012) Governança Corporativa e Velocidade de Incorporação de Informações: Lead-Lag entre o IGC e o IBrX. Revista Brasileira de Finanças, 10(1), 150-172

Pinto, Marcos Barbosa, & Leal, Ricardo Pereira Câmara. (2013). Ownership concentration, top management and board compensation. Revista de Administração Contemporânea, 17(3): 304-324.

Rechner, P., & Dalton, D. (1991). CEO duality and organizational performance: a longitudinal analysis. Strategic Management Journal, 12: 155-160.

Ross, S. (1973). The economic theory of agency: the principal’s problem. American Economic Review, 63: 134-139.

Rossoni, L, & Machado-da-Silva, Clovis L.. (2013). Legitimidade, governança corporativa e desempenho: análise das empresas da BM&F Bovespa. Revista de Administração de Empresas, 53(3): 272-289.

Silveira, A. M., Barros, L.A.B.C.,Famá,R.,(2006). Atributos Corporativos, Qualidade da Governança Corporativa e Valor das Companhias Abertas no Brasil. Revista Brasileira de Finanças 4(1): 1-30

Saltaji, I. M. F. (2013) Corporate Governance

Agency Theory How to Control Agency Costs. Internal Auditing & Risk Management, 4(32): 47-60

Shavell, S. (1979). Risk sharing and incentives in the principal and agent relationship. Bell Economic Journal, 10: 55-73.

Shleifer, A., & Vishny, R. W. (1997). A survey of Corporate Governance. The Journal of Finance, 52: 737-783.

Walsh, J. P., & Seward, J. K. (1990). On the efficiency of internal and external corporate control mechanism. The Academy of Management Review, 15(3): 421-458.

Williamson, O. E. The Mechanisms of Governance. New York: Oxford UP, 1996

Weisbach, M. S. (1988). Outside directors and CEO turnover. Journal of Financial Economics, 20: 431-460.

Westphal, J. D. (1999). Collaboration in the Boardroom: Behavioral and Performance Consequences of CEO-Board Social Ties. The Academy of Management Journal, 17: 7-24.

Westphal, J. D., & Bednar, M. K. (2005). Pluralistic Ignorance in Corporate Boards and Firms´strategic Persitance in Reponse to Low Firm Performance. Administrative Science Quarterly, 95: 262-298.

Westphal, J., & Fredrickson, J. (2001). Who directs strategic change? Director experience, the selection of new CEOs and change in corporate strategy. Strategic Management Journal, 22: 1113-1137.

Westphal, J., & Zajac, E. (1994). Substance and symbolism in CEO´s long term incentive plan. Administrative Science Quarterly, 39(3): 67-390.

Wilson, R. (1968). On the theory of syndicates. Econometrica, 36(1): 119-132.

Zahra, S., & Pearce, J. (1990). Determinants of board directors' strategic involvement. Long Range Planning, 8(2): 164-173.

Zucker, L. G. (1977). The role of institutionalization in cultural persistance. American Sociological Review, 42: 727-743.




Licença Creative Commons
Esta obra está licenciada sob uma licença Creative Commons Atribuição 4.0 Internacional.