Variable definitions
| Variables | Definition |
|---|---|
| Status | Network position of independent directors. We compute the arithmetic mean of the degree centrality scores of all independent directors on the board. To improve the interpretability of regression coefficients, we multiply firm-level degree centrality by 1,000 |
| Hierarchy | A dummy variable for seniority-based Promotion Practices,if independent directors are ranked primarily by “age” as the criterion, it is assigned a value of 1; otherwise, it is assigned a value of 0 |
| Size | Firm size, we measure it by taking the natural logarithm of the total assets |
| Lev | Debt-to-asset ratio, we calculate it by dividing the total liabilities by the total assets |
| Grossprofit | Gross profit margin on sales, we measure it using the formula of (operating revenue - operating cost) divided by operating revenue |
| Tobinq | Tobin's Q ratio |
| Top1 | Shareholding ratio of the largest shareholder, we measure it by dividing the number of shares held by the largest shareholder by the total number of shares outstanding |
| Female | Proportion of women in management, we measure it by dividing the number of female managers by the total number of managers |
| FrmAge | We measure it by ln (current year - company's founding year + 1) |
| Tenure_CEO | CEO tenure, we represent it by taking the natural logarithm of the number of months in the CEO's tenure |
| Dual | Duality of leadership (where the chairman of the board and the general manager are the same person): assign a value of 1 if they are the same individual, and 0 otherwise |
| Indep_per | Proportion of independent directors, we calculate it by dividing the number of independent directors by the total number of directors |
| Indep_age | Average age of independent directors, we represent it by taking the natural logarithm of the mean age of all independent directors in the company |
| Variables | Definition |
|---|---|
| Network position of independent directors. We compute the arithmetic mean of the degree centrality scores of all independent directors on the board. To improve the interpretability of regression coefficients, we multiply firm-level degree centrality by 1,000 | |
| A dummy variable for seniority-based Promotion Practices,if independent directors are ranked primarily by “age” as the criterion, it is assigned a value of 1; otherwise, it is assigned a value of 0 | |
| Firm size, we measure it by taking the natural logarithm of the total assets | |
| Debt-to-asset ratio, we calculate it by dividing the total liabilities by the total assets | |
| Gross profit margin on sales, we measure it using the formula of (operating revenue - operating cost) divided by operating revenue | |
| Tobin's Q ratio | |
| Shareholding ratio of the largest shareholder, we measure it by dividing the number of shares held by the largest shareholder by the total number of shares outstanding | |
| Proportion of women in management, we measure it by dividing the number of female managers by the total number of managers | |
| We measure it by ln (current year - company's founding year + 1) | |
| CEO tenure, we represent it by taking the natural logarithm of the number of months in the CEO's tenure | |
| Duality of leadership (where the chairman of the board and the general manager are the same person): assign a value of 1 if they are the same individual, and 0 otherwise | |
| Proportion of independent directors, we calculate it by dividing the number of independent directors by the total number of directors | |
| Average age of independent directors, we represent it by taking the natural logarithm of the mean age of all independent directors in the company |
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