Market reaction to Audit Committee director departures: Evidence from the post-SOX period

Etienne Redor ()
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Etienne Redor: Audencia Business School

Economics Bulletin, 2016, vol. 36, issue 3, 1267-1274

Abstract: Although the Audit Committee is a key component of corporate governance, very few studies have analyzed the market reaction to the departure of an Audit Committee Director. In this paper, we study the market reaction to 90 Audit Committee Director departures between 2004 and 2014. We find no significant market reaction at either the time of a non co-opted directors' departure or at the time of a financial expert directors' departure. Conversely, we show a significant positive market reaction at the announcement of a female Audit Committee member's departure, but no significant market reaction to the announcement of a male Audit Committee member's departure.

Keywords: Audit Committee; Director departure; Sarbanes-Oxley Act; SOX; Market reaction; Event studies; Co-opted director; Independent director; Financial expert; Gender (search for similar items in EconPapers)
JEL-codes: G3 M4 (search for similar items in EconPapers)
Date: 2016-07-08
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