TITLE:
Board Advising, Risk-Taking, and Firm Performance
AUTHORS:
Jianping Li
KEYWORDS:
Risk-Taking, Board Advising, Firm Performance
JOURNAL NAME:
Journal of Financial Risk Management,
Vol.5 No.3,
September
16,
2016
ABSTRACT: The corporate risk-taking has caught public attention due to the global financial crisis. Using a sample of listed companies in China from 2008 to 2015, this paper investigates how the role of board advising affects corporate risk-taking and the possible economics consequences of risk-taking. The empirical results show that the percentage of advisory directors is positively associated with the level of corporate risk-taking, and the interaction of the percentage of advisory directors and risk-taking is positively correlated with the future firm performance. However, these effects are not significant at all in the state-owned enterprises due to government’s interference.