Board Structure and Intragroup Propping: Evidence from Family Business Groups in Hong Kong
研究香港家族企业集团中董事会如何抑制集团内部利益输送，发现董事会规模大、独立董事比例高能减少利益输送，而家族高管兼任董事长则加剧该行为。
Using earnings announcement events made by group member firms in Hong Kong, this study examines the governance role of boards of directors in curbing propping activities within family business groups. We find that earnings released by group member firms affect the stock prices of their nonannouncing group peers in a manner consistent with intragroup propping. More importantly, this effect is less pronounced when the announcing firms have a larger board or a board with a higher proportion of independent directors, but more pronounced when they have an executive director from their controlling families acting as board chairperson. Furthermore, the monitoring effect of boards of directors is strengthened for firms subject to new regulations increasing board power. Our results suggest that board oversight can mitigate propping activities.