Abstract:This paper studies (i) the effects of external directors and managerial ownership, and (ii) the effects of shareholder monitoring, on risk-taking at banks. The former is part of the internal control mechanisms, the latter of external control. It also examines the difference between control mechanisms in the UK and in Japan. It shows that shareholder supremacy is likely to weaken corporate governance at banks. In particular, it finds that: (i) the substituted effects between internal and external controls diffe… Show more
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