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Etienne Redor and Magnus Blomkvist
''Are former military personnel valuable to shareholders? Evidence from boards of directors''
( 2022, Vol. 42 No.3 )
In recent years, many large US companies have appointed ex-military personnel to their boards of directors. While such personnel may have developed core competencies that are fundamental in the corporate world (Simpson and Sariol, 2019), they could also lack business experience and knowledge (An et al., 2020). The aim of this paper is to take a position in this debate by analyzing shareholders' points of view. Firstly, we studied the market's reaction to the announcement of an ex-military director appointment but failed to observe any significant reactions. Secondly, we analyzed the outcomes of director elections and showed that ex-military directors would receive significantly more “for” votes than other directors. We therefore concluded that shareholders do value ex-military directors.
Keywords: Military directors, Board of directors, Shareholder support, Event study, Director elections, Military rank, Military branch.
JEL: G3 - Corporate Finance and Governance: General
Manuscript Received : Sep 24 2021 Manuscript Accepted : Sep 30 2022

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