Robustness tests: shorter vs longer CEO tenure
| Panel A: CEO trustworthiness and board monitoring structure | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Dep = | Bd_Ind | Bd_Female | Bd_Size | Bd_IntM | Bd_RG | |||||
| (1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9) | (10) | |
| CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenur ≥ 8 | |
| Trust_CEO | −0.007*** (0.002) | −0.012 (0.010) | −0.003** (0.002) | 0.000 (0.007) | 0.081* (0.048) | 0.169 (0.189) | −0.218** (0.099) | −0.250 (0.472) | −0.093** (0.046) | −0.719 (0.566) |
| Observations | 11,457 | 4,744 | 11,457 | 4,744 | 11,457 | 4,744 | 6,215 | 1,854 | 3,965 | 1,341 |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| CEO Age Group | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Firm FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Year FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Adj./pseudo R2 | 0.718 | 0.774 | 0.723 | 0.792 | 0.811 | 0.859 | 0.232 | 0.256 | 0.949 | 0.973 |
| Panel A: CEO trustworthiness and board monitoring structure | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Dep = | Bd_Ind | Bd_Female | Bd_Size | Bd_IntM | Bd_RG | |||||
| (1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9) | (10) | |
| CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenur ≥ 8 | |
| Observations | 11,457 | 4,744 | 11,457 | 4,744 | 11,457 | 4,744 | 6,215 | 1,854 | 3,965 | 1,341 |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| CEO Age Group | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Firm FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Year FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Adj./pseudo | 0.718 | 0.774 | 0.723 | 0.792 | 0.811 | 0.859 | 0.232 | 0.256 | 0.949 | 0.973 |
| Panel B: CEO trustworthiness, board monitoring activities and CEO incentive alignment | ||||||||
|---|---|---|---|---|---|---|---|---|
| Dep = | Bd_Meet | Moni_Meet | CEO_Incent | CEO_Owner | ||||
| (1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | |
| CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | |
| Trust_CEO | 0.419** (0.189) | 0.492 (1.961) | 0.270** (0.115) | 1.159 (1.476) | −0.008** (0.004) | −0.015 (0.017) | −0.167* (0.099) | 0.995 (0.636) |
| Observations | 3,265 | 1,120 | 3,265 | 1,120 | 11,438 | 4,724 | 9,325 | 3,529 |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| CEO Age Group | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Firm FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Year FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Adj. R2 | 0.485 | 0.589 | 0.553 | 0.651 | 0.622 | 0.750 | 0.774 | 0.887 |
| Panel B: CEO trustworthiness, board monitoring activities and CEO incentive alignment | ||||||||
|---|---|---|---|---|---|---|---|---|
| Dep = | Bd_Meet | Moni_Meet | CEO_Incent | CEO_Owner | ||||
| (1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | |
| CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | CEO_Tenure < 8 | CEO_Tenure ≥ 8 | |
| Observations | 3,265 | 1,120 | 3,265 | 1,120 | 11,438 | 4,724 | 9,325 | 3,529 |
| Controls | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| CEO Age Group | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Firm FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Year FE | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Adj. | 0.485 | 0.589 | 0.553 | 0.651 | 0.622 | 0.750 | 0.774 | 0.887 |
Note(s): This table reports results examining whether our results are driven by shorter tenure CEOs. We conduct subsample analysis by separately examining firm-year observations when the CEO_Tenure is below the Q3 (i.e. 8 years) and above the Q3. Panel A examines the impact of CEOs' facial trustworthiness on board monitoring structure, while Panel B examines the impact of CEOs' facial trustworthiness on board monitoring activities and CEO incentive alignment. See Appendix for variable definitions. Robust standard errors are clustered at the firm and year level. The standard errors are reported in parentheses. ***, ** and * indicates p-values of 1, 5 and 10%, respectively
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