I study the relation between internal governance and creditor governance. A deterioration in creditor governance may increase the agency costs of debt and managerial opportunism at the expense of shareholders. I exploit the introduction of credit default swaps (CDS) as a negative shock to creditor governance. I provide evidence consistent with shareholders pushing for a substitution effect between internal governance and creditor governance. Following CDS introduction, CDS firms reduce managerial risk-taking incentives relative to other firms. At the same time, after the start of CDS trading, CDS firms increase managerial wealth-performance sensitivity, board independence, and CEO turnover performance-sensitivity relative to other firms.
Titolo: | Internal Governance and Creditor Governance: Evidence from Credit Default Swaps | |
Autori: | COLONNELLO, Stefano (Corresponding) | |
Data di pubblicazione: | 2017 | |
Serie: | ||
Handle: | http://hdl.handle.net/10278/3720075 | |
Appare nelle tipologie: | 7.01 Working paper |
File in questo prodotto:
File | Descrizione | Tipologia | Licenza | |
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cds_governance_wp.pdf | Working paper | Documento in Pre-print | Accesso chiuso-personale | Riservato |