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Ownership Structure, Intensive Board Monitoring, and Firm Value: Evidence from Korea


  • Acknowledgement: This paper is supported by a Korea University Grant.

Corresponding author: Ji Hye Lee, Korea University Business School, 145 Anam-ro, Seongbuk-gu, Seoul 136-701, Korea. Tel: +82-2-32901950, Fax: +82-2-32902552, email:


This article measures proxies for intensive board monitoring using Korean corporate governance data. We find that intensive board monitoring has a positive effect on firm value in Korea. We also explore the relationship between controlling shareholders' ownership and intensive board monitoring efficiency. We confirm that direct ownership by controlling shareholders moderates the relationship between intensive board monitoring and firm value. For firms with greater disparity between controlling shareholders' control rights and cash flow rights, the effect of intensive board monitoring on firm value decreases. These results suggest that the interplay among various internal control mechanisms affects corporate governance efficiency.