Corporate Governance: Directors` Liability and Board Structure

Abstract

This paper attempts to investigate the effect of directors` liability on corporate governance and the determinants of the board after the Sarbanes-Oxley Act (SOX). Based on the data of public firms in Taiwan during 2003-2007, the empirical findings suggest that board independence is positively related to Directors` & Officers` (D&O) insurance, debt ratio, bargaining power of CEO and high technology industry. Board leadership duality is negatively related to firm size and positively related to high technology industry. The findings also show that board size is positively related to D&O insurance in small firms but unrelated in large firms. The results in general suggest that directors` liability is an important determinant of board structure and D&O insurance provides monitoring incentive for corporate governance.

本文目的在於探討沙賓法案Sarbanes-Oxley Act（SOX）之後，董監事法律責任對公司治理之影響，以及分析董事會組成之決定因素。本研究以台灣上市公司2003－2007年之資料進行實證分析，研究結果顯示董事會之獨立性與董監事暨重要職員責任保險、負債比率、執行長之主導權以及高科技產業有顯著正向關係。董事長兼執行長之雙重領導現象（leadership duality）則與公司規模成反向關係，但與高科技產業成正向關係。此外，小型公司之董事會人數可能因有董監事責任保險保障而增加，但是在大型公司中則無此現象。整體而言，本研究結果顯示董監事之法律責任對於董事會的結構具有重要影響力，而其責任保險保障在公司治理上則可提供監督之功能。