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Online Public Lecture Series on Corporate Governance

Risk Perceptions, Board Networks, and Directors’ Monitoring in China

Michael Weisbach (Ohio State University and ECGI)

Xiaoyun Yu (Shanghai Advanced Institute of Finance (SAIF) and ECGI).

Thursday, 6 January 2022 

09:00 – 10:15 EST | 15:00 – 16:15 CET


Organised by

Jun Yang, Director of the Institute for Corporate Governance, Kelley School of Business, Indiana University


About the Event:

The third lecture in this series was given by Professor Michael Weisbach (Ohio State University and ECGI) based on his paper Risk Perceptions, Board Networks, and Directors’ Monitoring, co-authored with Wenzhi (Dave) Ding, University of Hong Kong Chen Lin, University of Hong Kong Thomas Schmid, University of Hong Kong. Professor Xiaoyun Yu (Shanghai Advanced Institute of Finance (SAIF) and ECGI) discussed the paper.

The lecture focused on what makes independent directors perform their monitoring duty. One possible reason is that they are worried about being sanctioned by regulators if they do not monitor sufficiently well. Using unique features of the Chinese financial market, Prof. Weisbach and his co-authors estimate the extent to which independent directors’ perceptions of the likelihood of receiving a regulatory penalty affect their monitoring.

Their results suggest that they are more likely to vote against management after observing how another director in their board network received a regulatory penalty related to negligence. This effect is long-lasting and stronger if the observing and penalized directors share the same professional background or gender and if the observing director is at a firm that is more likely to be penalized. These results provide direct evidence suggesting that the possibility of receiving penalties is an important factor motivating directors.

The public lecture series is organised by The Kelley School of Business Institute for Corporate Governance (ICG), in partnership with the Ostrom Workshop at Indiana University and ECGI.

See the presentation here: /sites/default/files/20220106_-_slides.pdf

For further information on the webinar please contact Professor Jun Yang, Director of the Institute for Corporate Governance at


Thursday, 06 January 2022 | 09:00 EDT (15:00 CET)

Welcome and Introduction


Q&A and Concluding Remarks



Michael Weisbach

The Ralph W. Kurtz Chair in Finance
The Ohio State University
Research Member

Xiaoyun Yu

Professor of Finance
Shanghai Advanced Institute of Finance, Shanghai Jiao Tong University
Research Member

Jun Yang

Conrad Prebys Professor of Finance
Indiana University Kelley School of Business
Research Member


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