Title

Do Military Independent Directors Improve Firm Performance?

Abstract

Characteristics and experiences of directors can affect firm performance. In this study, we examine the relationship between independent director military service and Tobin's Q. The impact of a director's military experience on firm value is increasingly important as corporations target military veterans for board seats. We find firms with independent directors with military experience tend to have poor firm performance. We explore R&D as a possible channel for the reduction in firm value and find firms with military independent directors also invest less in R&D. Overall, our findings suggest that past military service of directors does not improve firm performance.

Department(s)

Finance and General Business

Document Type

Article

DOI

https://doi.org/10.1016/j.frl.2021.101988

Keywords

Corporate governance, Firm Performance, Investment, Military executives, R&D

Publication Date

1-1-2021

Journal Title

Finance Research Letters

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