RESEARCH ARTICLE
Non-executive directors and corporate risk-taking: Evidence from China
Siyu Zhang,
Chao Lu,
Siyu Zhang
School of Finance, Renmin University of China, Beijing, China
Search for more papers by this authorCorresponding Author
Chao Lu
School of Economics and Management, Beijing Jiaotong University, Beijing, China
Correspondence
Chao Lu, School of Economics and Management, Beijing Jiaotong University, 3 Shangyuancun Road, Haidian District, Beijing 100044, China.
Email: [email protected]
Search for more papers by this authorSiyu Zhang,
Chao Lu,
Siyu Zhang
School of Finance, Renmin University of China, Beijing, China
Search for more papers by this authorCorresponding Author
Chao Lu
School of Economics and Management, Beijing Jiaotong University, Beijing, China
Correspondence
Chao Lu, School of Economics and Management, Beijing Jiaotong University, 3 Shangyuancun Road, Haidian District, Beijing 100044, China.
Email: [email protected]
Search for more papers by this authorAbstract
This study empirically examines the relationship between non-executive directors and corporate risk-taking. The findings show that non-executive directors could significantly improve the risk-taking level of corporations. Non-executive directors reduce corporate agency costs and alleviate financing constraints, thus promoting a corporation's risk-taking level. Further research shows that the positive impact of non-executive directors on corporate risk-taking is weakened by being state-owned, higher executive incentives, better external supervision, higher ownership concentration, higher management age and greater uncertainty in the external environment. Additionally, non-executive directors appointed by both controlling and non-controlling shareholders play a positive role in promoting corporate risk-taking.
Open Research
DATA AVAILABILITY STATEMENT
The data that support the findings of this study are available on request from the corresponding author. The data are not publicly available due to privacy or ethical restrictions.
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