Do independent boards effectively monitor management? Evidence from Japan during the financial crisis

Chunyan Liu, Jianlei Liu, Konari Uchida

Research output: Chapter in Book/Report/Conference proceedingChapter

6 Citations (Scopus)

Abstract

The financial crisis that originated in the collapse of the US subprime loan market had a serious impact on the global economy; various companies in all industries experienced serious performance declines. For example, Toyota Motor Corp., a Japanese representative automobile manufacturer, fell into a negative operating income situation for the accounting year ended March 2009, reporting red ink for the first time since the end of World War II. Such serious performance decline engenders severe conflicts among corporate stakeholders. This chapter investigates whether outside directors effectively monitor management in the interest of shareholders. Specifically, the chapter examines the relationship between board independence, management turnover and dividend policy in Japan during the financial crisis. Corporate board structures recently have received much research attention. This increased attention is largely attributable to the Sarbanes-Oxley Act (SOX), which mandates that the audit committees of listed companies comprise a majority of independent members.

Original languageEnglish
Title of host publicationCorporate Governance and the Global Financial Crisis
PublisherCambridge University Press
Pages188-214
Number of pages27
ISBN (Electronic)9780511736599
ISBN (Print)9781107001879
DOIs
Publication statusPublished - Jan 1 2011

Fingerprint

Financial crisis
Japan
Corporate boards
Mandate
Board structure
Income
Dividend policy
Management turnover
Listed companies
Toyota
Board independence
Global economy
Sarbanes-Oxley Act
Loans
Outside directors
Automobile
Subprime
Audit committee
Industry
Stakeholders

All Science Journal Classification (ASJC) codes

  • Business, Management and Accounting(all)

Cite this

Liu, C., Liu, J., & Uchida, K. (2011). Do independent boards effectively monitor management? Evidence from Japan during the financial crisis. In Corporate Governance and the Global Financial Crisis (pp. 188-214). Cambridge University Press. https://doi.org/10.1017/CBO9780511736599.010

Do independent boards effectively monitor management? Evidence from Japan during the financial crisis. / Liu, Chunyan; Liu, Jianlei; Uchida, Konari.

Corporate Governance and the Global Financial Crisis. Cambridge University Press, 2011. p. 188-214.

Research output: Chapter in Book/Report/Conference proceedingChapter

Liu, C, Liu, J & Uchida, K 2011, Do independent boards effectively monitor management? Evidence from Japan during the financial crisis. in Corporate Governance and the Global Financial Crisis. Cambridge University Press, pp. 188-214. https://doi.org/10.1017/CBO9780511736599.010
Liu C, Liu J, Uchida K. Do independent boards effectively monitor management? Evidence from Japan during the financial crisis. In Corporate Governance and the Global Financial Crisis. Cambridge University Press. 2011. p. 188-214 https://doi.org/10.1017/CBO9780511736599.010
Liu, Chunyan ; Liu, Jianlei ; Uchida, Konari. / Do independent boards effectively monitor management? Evidence from Japan during the financial crisis. Corporate Governance and the Global Financial Crisis. Cambridge University Press, 2011. pp. 188-214
@inbook{44d76b45676b4d12bb85e8bb91d6fe09,
title = "Do independent boards effectively monitor management? Evidence from Japan during the financial crisis",
abstract = "The financial crisis that originated in the collapse of the US subprime loan market had a serious impact on the global economy; various companies in all industries experienced serious performance declines. For example, Toyota Motor Corp., a Japanese representative automobile manufacturer, fell into a negative operating income situation for the accounting year ended March 2009, reporting red ink for the first time since the end of World War II. Such serious performance decline engenders severe conflicts among corporate stakeholders. This chapter investigates whether outside directors effectively monitor management in the interest of shareholders. Specifically, the chapter examines the relationship between board independence, management turnover and dividend policy in Japan during the financial crisis. Corporate board structures recently have received much research attention. This increased attention is largely attributable to the Sarbanes-Oxley Act (SOX), which mandates that the audit committees of listed companies comprise a majority of independent members.",
author = "Chunyan Liu and Jianlei Liu and Konari Uchida",
year = "2011",
month = "1",
day = "1",
doi = "10.1017/CBO9780511736599.010",
language = "English",
isbn = "9781107001879",
pages = "188--214",
booktitle = "Corporate Governance and the Global Financial Crisis",
publisher = "Cambridge University Press",
address = "United Kingdom",

}

TY - CHAP

T1 - Do independent boards effectively monitor management? Evidence from Japan during the financial crisis

AU - Liu, Chunyan

AU - Liu, Jianlei

AU - Uchida, Konari

PY - 2011/1/1

Y1 - 2011/1/1

N2 - The financial crisis that originated in the collapse of the US subprime loan market had a serious impact on the global economy; various companies in all industries experienced serious performance declines. For example, Toyota Motor Corp., a Japanese representative automobile manufacturer, fell into a negative operating income situation for the accounting year ended March 2009, reporting red ink for the first time since the end of World War II. Such serious performance decline engenders severe conflicts among corporate stakeholders. This chapter investigates whether outside directors effectively monitor management in the interest of shareholders. Specifically, the chapter examines the relationship between board independence, management turnover and dividend policy in Japan during the financial crisis. Corporate board structures recently have received much research attention. This increased attention is largely attributable to the Sarbanes-Oxley Act (SOX), which mandates that the audit committees of listed companies comprise a majority of independent members.

AB - The financial crisis that originated in the collapse of the US subprime loan market had a serious impact on the global economy; various companies in all industries experienced serious performance declines. For example, Toyota Motor Corp., a Japanese representative automobile manufacturer, fell into a negative operating income situation for the accounting year ended March 2009, reporting red ink for the first time since the end of World War II. Such serious performance decline engenders severe conflicts among corporate stakeholders. This chapter investigates whether outside directors effectively monitor management in the interest of shareholders. Specifically, the chapter examines the relationship between board independence, management turnover and dividend policy in Japan during the financial crisis. Corporate board structures recently have received much research attention. This increased attention is largely attributable to the Sarbanes-Oxley Act (SOX), which mandates that the audit committees of listed companies comprise a majority of independent members.

UR - http://www.scopus.com/inward/record.url?scp=84862798341&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84862798341&partnerID=8YFLogxK

U2 - 10.1017/CBO9780511736599.010

DO - 10.1017/CBO9780511736599.010

M3 - Chapter

AN - SCOPUS:84862798341

SN - 9781107001879

SP - 188

EP - 214

BT - Corporate Governance and the Global Financial Crisis

PB - Cambridge University Press

ER -