Research On The Impact Of Independent Directors' Local Tenure On Corporate Risk-taking

The independent director system is an important internal oversight mechanism of an enterprise.Improving its governance level can enhance the enterprise' s ability to bear risks and maximize the value of the enterprise.Therefore,the management's willingness to raise the level of independent directors' supervision to effectively prevent corporate risks is very obvious.However,in the face of an unreasonable internal governance structure and an uncertain external environment,can independent directors have a positive impact on the level of corporate risk-taking? In addition,with the development of geographic economics,some scholars have found that geographical distance will affect the behavior of economic subjects.As an important appointment characteristic,how will local tenure affect the performance function of independent directors,and how will it further affect the corporate risk-taking? These are all worth exploring.Therefore,based on the information asymmetry theory,principal-agent theory and reputation theory,this paper uses a combination of empirical research and normative research to investigate the impact of the independent director's local tenure on the risk level of the company.This article consists of five chapters.The first chapter is the introduction.It mainly expounds the research background,research ideas,research methods and innovations of this article,and reviews the related literature on the economic consequences of local employment and the influencing factors of corporate risk-taking levels.The second chapter is the definition of the concept and the theoretical basis.It defines and explains important concepts such as independent directors,local tenure,corporate risk-taking,legal environment,and women's participation in independent director teams.It also describes theories of information asymmetry,principal-agent theory,and reputation theory.The third chapter is theoretical analysis and research hypothesis.Describes the current status of local tenure of independent directors in China and the current status of corporate risk-taking,discusses the impact of independent directors' local positions on corporate risk-taking,and adds two regulatory variables: legal environment and female participation in independent director teams The moderating role of the relationship between the two finally concludes the research hypothesis of this article.The fourth chapter is the empirical test.This article selected 12118 samples of all A-share listed companies in Shenzhen and Shanghai,China from 2008 to 2015.The empirical test of the research hypothesis of this article using OLS regression model.The fifth chapter is the research conclusions,policy recommendations and future prospects.The study found:(1)The local tenure of independent directors inhibits the level of corporate risk tolerance;(2)The good legal environment has weakened the restraining effect of independent directors' local positions on the risk-taking of enterprises;(3)The participation of women in the independent director team has enhanced the suppression of the level of corporate risk-taking by local tenure.The research results of this paper have rich theoretical and practical significance.In terms of theoretical significance,it expands the research scope of independent directors' behavior and its economic consequences,corporate risk-taking behavior and its economic consequences,and also studies the situational factors of independent directors.Provided a supplement;In terms of practical significance,the local appointment of independent directors provides a theoretical basis for corporate governance,making listed companies pay more attention to the important internal supervision of independent directors.