Powerpoint slides of Group 4

Powerpoint slides of Group 4 -...

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voluntary corporate disclosures
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Team members Steven Rosanna Andy David Cathy
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Table of Contents Section 1 Section 2 Empirical Methods Section 3 Empirical Results Section 4 Further Tests & Conclusions
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Important of Corporate Disclosures Poor level of corporate disclosure Ineffective corporate governance  Contribute to Asian financial crisis  A stumbling block in the regional  economic recovery
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Important of Corporate Disclosures Better level of corporate disclosure  Reduce information asymmetry Imply a strong corporate governance Have a better monitoring on agency cost Lower cost of equity capital Reduce the cost of debt  Reduce the estimation risk or uncertainty  regarding the distribution of returns
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HK Environments – Regulatory  Authorities In early 1994, the Stock Exchange  of Hong Kong (SEHK)  mandated   all listed public companies must  have  at least two independent  NEDs  on the board of directors The HK Stockbrokers Association  and the Hong Kong Society of  Accountants (HKSA) called for  more disclosures in the annual  reports   Independent NEDs are expected  in strengthening corporate  governance  
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HK Environments Compared with  US Rare hostile takeovers in HK Director equity ownership in  large HK companies is higher  than US firms Absence of mergers and  acquisitions  Provide a different environment  for the analysis of CEO duality  and corporate disclosures
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Objectives of this study   Examines the linkage between  Director’s accountability Voluntary Corporate disclosures CEO duality CEO Concentrated decision making power
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Relationship Between Board of directors  and Voluntary Corporate disclosures Chairman CEO Executives Directors Non-Executive Directors Voluntary Corporate disclosures The Board Experience Non- Executive Directors
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Definition of CEO Duality and its  impacts Definition :  Vesting the power of the CEO and the chairman of  the board is one person   a strong individual  power base Impact :  Constrain board independence Reduce its ability to execute its oversight and  governance roles    exercise ineffective control More likely to be associated with lower levels of  voluntary disclosures   conceal fraud and  incompetence
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Definition of ENED The experience of  independent NED Sit on several  corporate boards  have developed  reputation capital  as experts 
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Impact of Experience of NED Most likely to be better-performing board  members by using their wider experience  and expertise in monitoring management  Limit the discretion of CEOs  Less likely to suffer from financial statement  fraud Ensuring higher levels of corporate  transparency
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Powerpoint slides of Group 4 -...

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