Abstract
This study draws upon prior research on corporate governance and examines whether the informativeness of earnings, proxied by the earnings response coefficient varies with the percentage of outside independent directors serving on the board, the absence of CEO duality, and the presence of independent audit (AUDC), compensation (COMC), and nominating (NOMC) committees. The results suggest a positive association between the proportion of outside independent directors serving on firm’s boards and earnings informativeness. However, the results do not suggest an association between non-CEO duality, or independent AUDC, COMC, and NOMC and earnings informativeness.
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Acknowledgments
The research contained in this paper was supported by a summer research grant from the Frank G. Zarb School of Business. I am thankful for and greatly appreciate the comments and guidance received from Dr. Bikki Jaggi at Rutgers University, Dr. Samir M. El-Gazzar at Pace University, and Dr. Michael J. Barnes at Hofstra University.
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Petra, S.T. The Effects of Corporate Governance on the Informativeness of Earnings. Economics of Governance 8, 129–152 (2007). https://doi.org/10.1007/s10101-006-0018-8
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DOI: https://doi.org/10.1007/s10101-006-0018-8