英文摘要 |
This study aims to examine the effect of over-tenured boards on internal control deficiencies. Using 2003-2016 Taiwanese public companies as the sample, the results show that the likelihood of internal control deficiencies decreases with the average tenure of the board of directors, but increases with the over-tenured board, suggesting that over-tenured boards are ineffective in supervision. This result is mainly driven by the tenure of general directors, not by the tenure of independent directors. We attribute this phenomenon to the possibility that the independent director system has not been implemented long enough to cause ineffective supervision by independent directors. In addition, using the contexts of better operations for corporate boards or higher demand for directors' experience value, the results still support that over-tenured boards increase the likelihood of internal control deficiencies. Finally, this study finds that tenure of at least 12 years is the turning point at which monitoring effectiveness may begin to suffer. Overall, the over-tenured board has lower monitoring effectiveness on internal control. |