Directors’ career concerns: Evidence from proxy contests and board interlocks

Research output: Journal article publicationJournal articleAcademic researchpeer-review

10 Citations (Scopus)


This paper studies the disciplinary spillover effects of proxy contests on companies that share directors with target firms, that is, interlocked firms. In difference-in-differences tests, I find that interlocked firms reduce excess cash holdings, increase shareholder payouts, cut CEO compensation, and engage in less earnings management in the year after proxy contests. The effects are more pronounced when both the interlocked and target firms have a unitary board and when the interlocking director is up for election, is younger, or has shorter tenure. Overall, the evidence highlights the importance of directors’ career concerns in policy spillovers across firms with board interlocks.

Original languageEnglish
Pages (from-to)894-915
Number of pages22
JournalJournal of Financial Economics
Issue number3
Publication statusPublished - Jun 2021


  • Board interlocks
  • Career concerns
  • Corporate governance
  • Proxy contests

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics
  • Strategy and Management


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