How Does the Board of Directors React when Faced with Corporate Scandals? A Study of CEO, Chairman, and Auditor Turnover
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- Master of Science 
In this paper, we examine how the board of directors react when faced with corporate scandals. We compare 75 Norwegian firms involved in corporate scandals with 75 control firms and measure how these scandals impact the probability of CEO, chairman, and auditor turnover. We find minimal previous literature on this topic and none relating to Norwegian firms. By employing a logistic regression model in multiple stages, we find statistical evidence that firms involved in scandals have higher turnover rates for all three board reactions, indicating that the board of directors are effective monitors in corporate scandals. Further, we discover that board size, board independence, and female board presence significantly influence our three board reactions, both independent and conditional on corporate scandals.
Masteroppgave(MSc) in Master of Science in Business, Finance - Handelshøyskolen BI, 2021