| Independent director system is a key component of the corporate governance structure.It has been 26 years since 1993 when listed companies in China began to employ independent directors.Appointment of external directors independent of company management can help enterprises reduce agency costs and improve information transparency,which plays an important role in corporate governance environment.On October 19,2013,the promulgation of "no.18" clearly stipulated whether government executives could work part-time in enterprises and their remuneration,leading to a large number of official independent directors resigned.This phenomenon of collective resignation of official independent director caused by the change of central policy provides a good opportunity to study the impact of the loss of political connections on enterprise performance.Based on China’s current national conditions,this paper studies the impact of the resignation of official independent directors on enterprise performance,further explores the differences of the impact of the resignation of local and central officials on enterprise performance,and the impact of the resignation of official independent directors on enterprise performance under different market-oriented processes.This paper takes 2014 as the event year after the promulgation of "no.18",and compares the changes of enterprise performance in the three years before and after 2014.Hand-collected and discriminated 301 official independent directors resignation samples.Matched the control group samples with similar conditions using the propensity score matching,using difference-in-differences model to study the impact of the resignation of official independent directors on business performance.Empirical results show that:The resignation of the official independent director has a significant negative impact on enterprise performance.That means,the resignation of the official independent director makes the enterprise performance decrease significantly.Further research finds that relative to central official independent director,the resignation of local official independent director has a greater negative impact on enterprise performance.In addition,The lower the marketization process,the greater the negative impact of the resignation of the official independent director on enterprise performance.Finally,The regression results of robust test still support the above conclusions.The results of this study provide policy support for standardizing the system of independent directors,restraining officials from abusing their power to seek rent,and building an external governance environment. |
