Does board diversity affect institutional investor preferences? Evidence from Latin America

Maria Camila De-La-Hoz (), Carlos Pombo and Rodrigo Taborda

No 15991, Documentos CEDE from Universidad de los Andes, Facultad de Economía, CEDE

Abstract: This paper enquires whether institutional investors have specific preferences on the composition of the board of directors in Latin American firms they hold shares in. The result show that preferences vary significantly in terms of the type of institutional investor. The econometric results suggest grey institutional investors (pension funds and insurance companies) prefer experience and education, while dislike CEO entrenchment. Independent institutional investors value more directors’ professional experience i.e., former CEOs and founders of any firm. Grey investors are more concern on firm corporate governance mechanisms consistent with the agency view, while independent investors are focused in business opportunities in accordance with the resource-based-view of board of directors.

Keywords: Director Heterogeneity; board capital; institutional investor preferences; Latin America (search for similar items in EconPapers)
JEL-codes: G10 G11 G34 (search for similar items in EconPapers)
Pages: 56
Date: 2018-01-25
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:col:000089:015991

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