Board structure and the informativeness of earnings
نویسنده
چکیده
This study draws on prior research on corporate governance and examines whether the informativeness of earnings, proxied by the earnings±returns relationship, varies with the fraction of outside directors serving on the board and board size. The results suggest that earnings of ®rms with the smallest boards in the sample (with a minimum of ®ve board members) are perceived as being more informative by market participants. By contrast, there is no evidence that board composition mitigates the earnings±returns relation. Policy implications are discussed. Ó 2000 Elsevier Science Ltd. All rights reserved.
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