1. finance

Moursli Mohamed Reda
Home Address:
Office:
Volrat Thamsgatan 6,
Apt 1004, Gothenburg,
412 60, Sweden
Department of Economics,
Center for Finance
University of Gothenburg
Box 640, 40530 Gothenburg
Telephone: (+46) 31-7865970 (office)
(+46) 76-3290361 (mobile)
E-mail: [email protected]
Webpage: https://sites.google.com/site/mourslireda/
Citizenship: Moroccan
Languages: English, French, Arabic, Swedish (beginner)
Fields of Concentration:
Empirical Corporate Finance
Corporate Governance
Board of Directors
Desired Teaching:
Corporate Governance
Time Series Econometrics
Corporate Finance
Dissertation Title: Corporate Governance, and the Design of Board of Directors
Expected Completion Date: May 2015
Degrees:
M.Sc. (2009), Finance, Department of Economics, Gothenburg University, Sweden
B.A. (2006), Business Administration and Finance, Al Akhawayn University, Morocco,
(cum laude),
Teaching Experience:
Lecturer, Applied Time Series Econometrics, Fall 2011-2014 (graduate)
Lecturer, Undergraduate Econometrics, 2011-2014
Teaching Assistant, Financial Econometrics, 2011-2013 (graduate)
Supervisor, Bachelor Thesis in Financial Economics
Papers and Work in Progress:
“The Effects of Board Independence on Busy Directors and Firm Value: Evidence from
Regulatory Changes in Sweden”, Gothenburg University, 2014. [job market paper]
“The Worth of a Directorship in the Eyes of Busy Directors”, Gothenburg University, 2014
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“Investor Protection and the Predictability of Dividends and Returns: A Cross Country
Comparison”, Gothenburg University, 2013.
“Directors’ Remuneration, Discipline and Committee Participation in Sweden”, Gothenburg
University, 2013. [work in progress]
“The Quality of Corporate Governance in Swedish Firms: An Index for Directors”,
Gothenburg University, 2014. [work in progress]
Conference Presentations:
“The Effects of Board Independence on Busy Directors and Firm Value: Evidence from
Regulatory Changes in Sweden”. Presented at the PhD Workshop in Corporate Governance,
Hanken Center for Corporate Governance, Helsinki, August 2014, and at the General
Economics Workshop, Gothenburg, September 2014.
“The Worth of a Directorship in the Eyes of Busy Directors”. Presented at the Center for
Finance Workshop, Gothenburg, November 2014.
References:
Professor Martin Holmen
Department of Economics
Gothenburg University
Address: P.O. Box 640, SE 405 30,
Gothenburg, Sweden
Phone: (+46) 31 786 6442
Email: [email protected]
Professor Erik Hjalmarsson
Department of Economics
Gothenburg University
Address: P.O. Box 640, SE 405 30,
Gothenburg, Sweden
Phone: (+46) 31 786 1346
Fax:(+46) 31 786 1326
Email: [email protected]
Professor Måns Söderbom
Deputy Head of Department
Department of Economics
Gothenburg University
Address: P.O.Box 640, SE 405 30,
Gothenburg, Sweden
Phone: (+46) 31 786 4332
Fax: (+46) 31 786 1326
E-mail: [email protected]
Dissertation Abstract:
My dissertation consists of two chapters. The first paper of chapter I, “The Effects of Board
Independence on Busy Directors and Firm Value: Evidence from Regulatory Changes in
Sweden”, investigates the impact of board independence on Swedish firm’s Tobin’s Q, using
a regulatory shock to the market as a source of exogenous variation. It also investigates how
board busyness is impacted by the regulatory change. The second paper, “The Worth of a
Directorship in the Eyes of Busy Directors”, investigates if busy directors value their outside
directorships differently, and identifies if this has an impact on firm outcomes. The last
chapter, “Investor Protection and the Predictability of Dividends and Returns: Evidence from
International Markets”, is a cross-country study, where I try to identify the link between the
factors that drive return predictability and the quality of corporate governance.
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Chapter I: Board Characteristics, Independent Directors and Firm Performance
A central question in corporate governance is whether board independence affects firm value
and performance? Answering this question has important implications for the design of better
corporate governance regulation, eventually leading to an improved board structure and a
higher shareholder value. From a regulatory point of view, an increase in the independence of
the board aims at improving monitoring, and the management of firms. However, if the
independent board members are busy directors the positive effect expected by regulators, on
firm outcomes, may not be warranted. In fact, the literature is divided as to whether busy
independent boards impact positively firm outcomes (Ferris el al 2003) or have a negative
impact on firm value (Fich and Shivdasani 2006, Cashman et al 2012). Another aspect,
which is usually overlooked in the literature, is the fact that independent (busy) directors can
value the directorships they hold differently. This can be due to differences in terms of
ownership concentration, compensation, and firm reputation. Thus, in order to identify the
effect of directors’ and board characteristics on firm performance or value, taking into
account all these elements is of essence.
In the first paper (Job Market Paper), “The Effects of Board Independence on Busy
Directors and Firm Value: Evidence from Regulatory Changes in Sweden”, I use an
exogenous change to the rules of corporate governance for Swedish firms in 2005 to
identify the causal effects of changes in board structure on firm value. The new rules
require there to be at least 50% of independent directors in boards, without putting
any restrictions on the number of outside directorships held by board members. Such
an event offers a quasi-experimental setting, where I test for the effects of changes in
board independence on Tobin’s Q, used as a proxy for the market valuation of firms.
Additionally, I also investigate the effect board independence has on the busyness of
the boards. In order to identify the effects of this shock, and alleviate endogeneity
issues inherent to corporate governance studies, I first use a regression discontinuity
design to capture the reaction of the market to the new governance rules, taking
advantage of the fact that only firms with a market cap greater than 3 billion SEK (i.e.
large firms) are forced to comply with the new rules. Second, I also use firm size in an
instrumental variable approach to estimate the causal effect of board independence on
firm’s Tobin’s Q. The results indicate that (a) The market reacts negatively to the
enactment of the new governance rules; (b) Tobin’s Q decreases after an increase in
board independence, and (c) an increase in board independence is associated with an
increase in board busyness, which might explain the effects on (a) and (b).
The second paper in this chapter, “The Worth of a Directorship in the Eyes of Busy
Directors”, studies the effect of busy directors on the value and performance of Swedish
publically traded firms. I consider the case where directors value their directorships
differently, either based on reputational concerns or on differences in ownership structures.
To measure reputation, I use the median of ROA and market value of firms as a benchmark to
rank directorships. I find that higher firm performance and value are associated with a rise in
the proportion of directors that consider a firm as better, relative to other firms they hold in
their portfolio of directorships. This effect holds when focusing attention on independent
directors. However, a higher number of directors with outside directorships in firms with high
control, does not impact the performance or the value of firms with low control. In other
words, the relative control among firms held by a director does not work as an exogenous
incentive for that director in reallocating his effort across directorships.
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Chapter II: Investor Protection and The predictability of Returns and Dividends
The difference in the quality of institutions across countries plays a central role in identifying
what drives equity price variations in each market. In fact, the quality of corporate
governance, and the extent of law enforcement within a country have an impact on dividend
policy, stock return performance, and equity market volatility (see La Porta et al. 2000, and
Harvey 1995). These effects translate into differences in the relative predictability of
dividends and returns across countries. The aim of this study is to see how the relationship
between the quality of corporate governance and the predictability of returns and dividends
differs across countries.
Thus in the final paper, “Investor Protection and the Predictability of Dividends and
Returns: A Cross Country Comparison”, I investigate if differences in the level of investor
protection across countries impacts return and dividend growth predictability. The study
covers 59 equity markets representing both developed and emerging economies. I first
identify if expectations about returns or dividend growth drive predictability at a country
level. In order to circumvent invalid inference due to biased OLS standard errors, inherent to
predictive regressions, I use the Campbell and Yogo (2006) efficient Bonferroni test of
predictability. The main finding is that expectations about return explains most of the
variation in current dividend yield in countries with high investor protection, while
expectations about dividend growth play a similar role for countries with low investor
protection. I also find that investor protection rights are positively correlated to return
predictability, and negatively correlated to dividend growth predictability.
Work In Progress:
“The Quality of Corporate Governance in Swedish Firms: An Index for Directors”
When we think about corporate governance, we usually pay little attention to how directors
view firms. From the literature, we know that reputation is important to directors, and that
firm reputation is tightly linked to director’s reputation (Tirole 1996). The objective here is to
define firm reputation in terms of firm and board characteristics, and see if this reputation is
determinant in attracting directors to the board of firms. The index has three main
components. The first component contains information relative to the historical performance
and market value of the firm, relative to the industry as a benchmark. Firm size is also
included, as a traditional measure of reputation. The second component deals with ownership
concentration, accounting not only for the existence of large shareholders, but also the
ownership of the CEO and other directors in the board. The third component contains board
characteristics, such as board independence, networking opportunities for directors, the
presence of nomination and remuneration committees, and the compensation of directors.
“Directors’ Remuneration, Discipline and Committees Participation in Sweden”
In this paper I am trying to investigate the effects of having remuneration and election
committees on the working of the board in Swedish publically traded firms. I also use
information about the attendance of board members to board meetings, associated with their
remuneration and ownership in the firm, in order to measure the degree of discipline among
directors.
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