Document Type



Doctor of Philosophy (PhD)


Business Administration

First Advisor's Name

Arun Upadhyay

First Advisor's Committee Title

Committee Chair

Second Advisor's Name

Shahid Hamid

Second Advisor's Committee Title

Committee Member

Third Advisor's Name

Ravi Gajendran

Third Advisor's Committee Title

Committee Member

Fourth Advisor's Name

Qiang Kang

Fourth Advisor's Committee Title

Committee Member

Fifth Advisor's Name

Krishnan Dandapani

Fifth Advisor's Committee Title

Committee Member

Sixth Advisor's Name

Edward Lawrence

Sixth Advisor's Committee Title

Committee Member


finance and financial management

Date of Defense



This dissertation examines exploring how a board structure protects and creates shareholder value. The main responsibilities of a board of directors are to enhance the shareholder value by setting a strategic direction for the firm, monitoring, and advising managers. A structure of a board of directors could range from board size, independent board ratio to gender diversity, inside-outside chairperson, committee designs. How exactly a board structure could create value and through what channels are one of the biggest challenges in corporate finance.

In the first essay, I use board structure changes brought by the Sarbanes-Oxley Act (SOX; 2002) and subsequent listing standards as a natural experiment to investigate if founding families are expropriators or stewards of shareholder value. I hypothesize gain in a firm’s value post-SOX if founding families are expropriators and a value loss if they are stewards. Using a difference-in-difference approach, I find that family firms that did not meet the requirements of SOX-related, board independence provisions before 2002, suffered significant value loss post-SOX. The results favor the steward role for founding families.

In the second essay, I examine the effect of an independent board structure on shareholder value in the context of mergers and acquisitions. The success of M&A transactions depends on the quality of supervision by corporate boards. Effective board monitoring could prevent entrenched managers from undertaking bad acquisitions. I find that acquirers with independent board chairpersons earn significantly higher CAR around M&A announcements. I find that the boards led by independent chairpersons primarily add value by selecting targets with high synergetic gains, avoiding overpaying for targets, and facilitating smooth transition in the post-acquisition phase.

In the third essay, I study whether effective monitoring by independent executive directors can mitigate stock return tail risk. Since these directors are active executives of other firms, they may have a better understanding of corporate practices due to their knowledge, expertise, and networks than other independent directors. I argue that these directors are more likely to understand various forces that affect crash risk and monitor them more effectively. Using a large sample of US public firms from 1996 to 2018, I find a negative association between independent directors and future stock crash risk. The results are robust to several econometric treatments addressing endogeneity and to alternative measures of stock crash risk. Additionally, I find the association between independent executive directors and crash risk is more pronounced among firms with weaker governance and higher information asymmetry. Collectively, this paper highlights the importance of director experience in protecting shareholders by curbing bad news hoarding activities.





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