Amin, A., Mollah, S. orcid.org/0000-0002-6342-8309, Kamal, S. et al. (2 more authors) (2024) Independent directors’ connectedness and bank risk-taking. Journal of Financial Stability, 75. 101324. ISSN 1572-3089
Abstract
This study examines the role of independent directors’ network centrality in bank risk-taking. Following the shareholder-incentive hypothesis and social-network theory, we predict and find that independent directors’ connectedness is positively associated with bank risk-taking. The results hold after a battery of robustness checks and endogeneity tests. Furthermore, consistent with the influence channel of networks, we show that connectedness empowers independent directors, whereas influential independent directors facilitate aggressive investment. We also find that the risk-taking effects are more pronounced for complex banks and banks with higher equity capital, higher income diversity, and lower cost-efficiency.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2024 The Author(s). Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/). |
Keywords: | Risk-taking; Network centrality; Independent directors’ connectedness |
Dates: |
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Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Management School (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 23 Sep 2024 13:08 |
Last Modified: | 23 Sep 2024 13:08 |
Status: | Published |
Publisher: | Elsevier BV |
Refereed: | Yes |
Identification Number: | 10.1016/j.jfs.2024.101324 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:217487 |