Board faultlines and the value of cash holdings: Evidence from Chinese listed companies

Abstract Faultlines can affect a board of director’s effectiveness in supervising senior managers, which turn affects the value company’s cash holdings. Based on sample data from Chinese A-share listed companies 2004 to 2016, we examine relationship between faultlines and The empirical results indicate that have significant inhibitory effect holding value. This is stronger for resulting deep-level attributes. Furthermore, state-owned enterprises (SOEs) than non-SOEs. As an important governance mechanism, management shareholdings reduce agency costs mitigate negative impact fissures Overall, enrich literature economic consequences their influence We also offer practical suggestions improving supervisory mechanism directors.