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| Masanori Orihara |
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| ''Board independence and a shareholder's commitment'' |
| ( 2017, Vol. 37 No.2 ) |
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| Our model shows that it is optimal for shareholders to choose boards of directors whose preferences do not align with those of the shareholders. Such a board composition works as the shareholders' commitment to providing an incentive for risk-averse CEOs. |
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| Keywords: board of directors, commitment, contract enforceability |
JEL: G3 - Corporate Finance and Governance: General
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| Manuscript Received : Sep 27 2016 | | Manuscript Accepted : Apr 22 2017 |
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