Andreou, Panayiotis , Antoniou, Constantinos, Horton, Joanne and Louca, Christodoulos (2016) Corporate governance and firm-specific stock price crashes. European Financial Management, 22 (5). pp. 916-956. doi:10.1111/eufm.12084 ISSN 1354-7798.

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Abstract

We investigate whether ownership structure, accounting opacity, board structure & processes and managerial incentives attributes relate to future stock price crash risk. Principal component analysis on the 21 attributes that comprise these four corporate governance dimensions reveals that they can explain between 13.1% and 23.0% of a one standard deviation in crash risk. Transient institutional ownership, CEO stock option incentives and the proportion of directors that hold equity increase crash risk, whilst insiders' ownership, accounting conservatism, board size and the presence of a corporate governance policy mitigate crash risk. Overall these relationships are more pronounced in environments that accentuate agency risk.

Item Type:	Journal Article
Divisions:	Faculty of Social Sciences > Warwick Business School > Behavioural Science Faculty of Social Sciences > Warwick Business School
Journal or Publication Title:	European Financial Management
Publisher:	Wiley-Blackwell Publishing Ltd.
ISSN:	1354-7798
Official Date:	November 2016
Dates:	Date Event November 2016 Published 6 March 2016 Available 30 November 2015 Accepted
Volume:	22
Number:	5
Page Range:	pp. 916-956
DOI:	10.1111/eufm.12084
Status:	Peer Reviewed
Publication Status:	Published
Access rights to Published version:	Restricted or Subscription Access

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