Nonexecutive director influence on informational asymmetries in Caribbean offshore financial centers
研究了加勒比离岸证券交易所上市公司中非执行董事个人持股与公司买卖价差的关系，发现持股增加会扩大价差，但正式制度质量和固定汇率制会缓解此效应，离岸司法管辖区则会加剧。
Abstract Question/issue This is a study of the relationship between nonexecutive director personal ownership and firm's bid ask spreads in listed firms from across the Caribbean offshore securities exchanges. Research findings/insights We report that bid ask spreads increase with nonexecutive ownership. However, this result is reduced (negatively moderated) in the context of higher formal institutional quality and also if the territory has a fixed exchange rate regime but exacerbated (positively moderated) if the firm is located within an offshore jurisdiction. Theoretical/academic implications The results regarding the influence of nonexecutive director ownership on firm liquidity‐based transaction costs, namely, market estimates of bid ask spreads, are interpreted in terms of the contingency of this relationship on the wider institutional context. The effectiveness of nonexecutive directors is highly contingent upon the specific institutional context. Higher formal institutional quality and the presence of a strong macroeconomic tie between territory and Organisation for Economic Co‐operation and Development (OECD) country lead to a reduction in these costs, while offshore financial centers lead to their increase. We argue that this highlights a shortcoming of agency theory's more limited view of institutions. Practitioner/policy implications The results support regulator's focus on board of director composition and in particular nonexecutive remuneration in the form of ownership. Given the increasing dominance of Anglo‐American governance, firms worldwide are increasing the proportions of nonexecutive directors on their boards. However, their role is acutely context specific which is reflected in the relationship between their personal ownership and the liquidity‐borne transaction costs of the firm as a whole.