Directors’ education and corporate liquidity: evidence from boards in Taiwan

Ma-Ju Wang (), Xuan-Qi Su (), Hong-Da Wang () and Yan-Shing Chen ()
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Ma-Ju Wang: National Kaohsiung First University of Science and Technology
Xuan-Qi Su: National Kaohsiung First University of Science and Technology
Hong-Da Wang: National Kaohsiung First University of Science and Technology
Yan-Shing Chen: National Taiwan University

Review of Quantitative Finance and Accounting, 2017, vol. 49, issue 2, No 7, 463-485

Abstract: Abstract This study relates a firm’s cash holdings and their value to the board of directors’ level of education. Using a sample of firms on the Taiwan Stock Exchange during the period from 2006 to 2012, we find that firms with a highly educated board tend to hold more cash and are associated with a higher value of cash. This fact is especially evident among financially constrained firms. Our findings suggest that highly educated boards provide more efficient monitoring and advisory functions, and thus complement corporate governance.

Keywords: Cash holdings; Education; Director; Corporate governance; Organizational legitimacy (search for similar items in EconPapers)
JEL-codes: G32 G34 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (5)

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DOI: 10.1007/s11156-016-0597-6

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