Multiple Directorships and Firm Performance: Evidence from Firm Characteristics discussant: Yu, V. School of Accounting Institute of Accounting and Finance Shanghai University of Finance and Economics

a chicken standing among cranes Attending this high-class conference, I feel like “a chicken standing among cranes”. If my comments on this paper is amateur, please do not laugh, or laugh in silence.

agency theory & resource dependence theory The author propose an interesting point: two channels of corporate governance Agency theory: directors as the control(monitoring) role Resource dependence theory: directors as the resource acquirer role

an analogy Suppose you are a junior faculty (with a preliminary draft) intending to find a scholar to coauthor with option 1: coauthoring a scholar who has no other papers going on option 2: coauthoring a scholar who has a lot of papers going on

a scholar with no other papers going on: supposed to have much time helping revising your paper a scholar who has a lot of papers going on: (1) too busy to help revise your paper, (2) but may have a good record of publication, and therefore, provides value in advising or endorsement

If your paper covers an interesting topic (idea) but needs substantial improvement: better coauthor with a scholar with no other papers going on If your paper is already of good quality, and needs endorsement rather than improvement: better coauthor with a scholar with a lot of papers going on reputation as hostage: coauthoring with a famous scholar gives a strong signal to editors and referees

A buddha statue in the temple, whether he has done anything is not important, as long as he sits there.

Since “endorsement” can help improve market perception, but may not affect accounting performance, the relationship in the paper may not be due to “endorsement”.

some suggestions On page 10, proposing Hypotheses I and III would be enough. Tobin’s Q, and industry-adjusted Tobin’s Q accounting profitability and industry-adjusted accounting profitability As the proxy for agency conflicts, Governance Index may be too widely-covered to be informative For the proxy of agency conflicts, “CEO centrality”(Bebchuk, Cremers and Peyer, 2007) may be an alternative

future researches as in the paper, for firms with low growth opportunity and high agency conflicts, to test whether multiple directorship is bad for such firms In addition to accounting performance……. (1) performance sensitivity of CEO turnover (2) stock returns accompanying acquisitions

information asymmetry A firm with high information asymmetry (or high non-book value) may not need advising, but needs endorsement possible alternative research orientation e.g., dependent variable: Tobin’s Q interaction variable: (R & D)*(busyness of directors) Multiple directorship (reputation effect) may help a firm’s non-book value to be credibly perceived by the market