Research On The Influence Of Friendly Independent Directors On The M&A Decisions

Independent directors play an important role in the company's major decision-making,and have advisory functions(providing decision-related information)and supervisory functions(supervising executive hollowed-out behavior)in M&A activities,while the existence of hidden social relations between independent directors and the top management of the enterprise is reflected in M&A,which may be manifested in the fact that independent directors give more sufficient consulting information to senior management of the enterprise on the one hand,and that independent directors may be too trusting or malicious connivance in the decision-making behavior of enterprise executives on the other hand,and weaken such supervision.And in M&A decision,does the independent director have strong advisory effect,as well as anti-supervision effect?If both the anti-supervision effect and the consulting effect exist,what effect will it have on M&A decision under their interaction?From the point of view of social relations,this paper studies whether "friendly" independent directors(independent directors graduated from the same institution with the CEO or chairman of the company or served in third-party enterprises other than the company)have strong advisory effect and anti-supervision effect in M&A decision,and the influence of "friendly" independent directors on M&A decision under the interaction between them,which is of great significance to improve the independent director system,standardize M&A behavior and enhance M&A synergy.This article quantifies "friendly" independent directors and mergers and acquisitions decisions,and through theoretical analysis and empirical tests,reveals that the implicit social relationship of "friendly" independent directors is important for target companies with high/low synergy value,supportive/empty The impact of merger and acquisition decisions such as mergers and acquisitions and merger premiums.It is found through research that when"friendly" independent directors exist within the M&A company,it is more likely that hollow-out M&A transactions will occur,and it will be easier to pay a higher M&A premium,but there will be no significant impact on target companies with high/low synergy value.influences.In addition,in order to explore whether there are consulting effects and anti-supervisory effects for "friendly" independent directors,this paper analyzes and quantifies the consulting and supervision needs of enterprises,and further research finds that for M&A decision-making target companies with high/low synergy value and M&A premium "Friendly"independent directors have consulting effects and anti-supervisory effects,and in mergers and acquisitions with low consulting or high supervision requirements,the existence of "friendly"independent directors will make corporate mergers and acquisitions generate low synergy value and pay high merger and acquisition premiums.Increased likelihood.Finally,according to the research conclusions,measures to improve the independent director system and the information disclosure system are proposed.It not only improves the corporate governance theory and the theory of mergers and acquisitions,but also provides theoretical guidance for companies to improve mergers and acquisitions decisions,and provides operable suggestions for the government to improve the independent director system and effectively monitor mergers and acquisitions.