The Study On The Relationship Of The Independence Of Board And The Marginal Value Of Cash Holdings

As the core of governance mechanism, construction of board governance and the marginal value of cash holdings (MVCH) has become the research emphasis in recent years. As a series of corporate governance scandals occurs in the European and American countries, the board of directors in corporate governance usually act as "inaction" and "vase director".the Poor even bad stupid performance of preventing the loss of its shareholders made people cause more and more deep questions and concerns to the board of directors system. In theory, the independence of board of directors influence the efficiency of corporate governance, and corporate governance efficiency has a decisive role on MVCH, so the board independence should have a certain influence on MVCH.Taking the date of 1496 A-share listed companies during the period 2008-2014, this paper attempts to explore the effects of independence of board on MVCH. The empirical results show that there is significant positive correlation between them. there is higher MVCH with higher independence index of board;And in the process of independence of board affecting MVCH, corporate governance efficiency plays an intermediary role. Further divide the sample into the financing constraint and the non-financing constraint groups to study the board independence and MVCH, in the financing constraint group the results performance significantly, and in the non-financing constraint group not significant. Finally, we find that corporations with good governance display a higher MVCH than the bad ones.