Three Essays In Corporate Governance

This dissertation examines exploring how a board structure protects and creates shareholder value. The main responsibilities of a board of directors are to enhance the shareholder value by setting a strategic direction for the firm, monitoring, and advising managers. A structure of a board of directors could range from board size, independent board ratio to gender diversity, inside-outside chairperson, committee designs. How exactly a board structure could create value and through what channels are one of the biggest challenges in corporate finance. In the first essay, I use board structure changes brought by the Sarbanes-Oxley Act (SOX; 2002) and subsequent listing standards as a natural experiment to investigate if founding families are expropriators or stewards of shareholder value. I hypothesize gain in a firm’s value post-SOX if founding families are expropriators and a value loss if they are stewards. Using a difference-in-difference approach, I find that family firms that did not meet the requirements of SOX-related, board independence provisions before 2002, suffered significant value loss post-SOX. The results favor the steward role for founding families. In the second essay, I examine the effect of an independent board structure on shareholder value in the context of mergers and acquisitions. The success of M&A transactions depends on the quality of supervision by corporate boards. Effective board monitoring could prevent entrenched managers from undertaking bad acquisitions. I find that acquirers with independent board chairpersons earn significantly higher CAR around M&A announcements. I find that the boards led by independent chairpersons primarily add value by selecting targets with high synergetic gains, avoiding overpaying for targets, and facilitating smooth transition in the post-acquisition phase. In the third essay, I study whether effective monitoring by independent executive directors can mitigate stock return tail risk. Since these directors are active executives of other firms, they may have a better understanding of corporate practices due to their knowledge, expertise, and networks than other independent directors. I argue that these directors are more likely to understand various forces that affect crash risk and monitor them more effectively. Using a large sample of US public firms from 1996 to 2018, I find a negative association between independent directors and future stock crash risk. The results are robust to several econometric treatments addressing endogeneity and to alternative measures of stock crash risk. Additionally, I find the association between independent executive directors and crash risk is more pronounced among firms with weaker governance and higher information asymmetry. Collectively, this paper highlights the importance of director experience in protecting shareholders by curbing bad news hoarding activities

Advanced control strategy of back-to-back PWM converters in PMSG wind power system

This paper proposes a control scheme of back-to-back PWM converters for the permanent magnet synchronous generator (PMSG) wind turbine system. The DC-link voltage can be controlled at the machine-side converter (MSC), while the grid-side converter (GSC) controls the grid active power for a maximum power point tracking (MPPT). At the grid fault condition, the DC-link voltage controller is designed using a feedback linearization (FL) theory. For the MPPT, a proportional control loop is added to the torque control to reduce the influence of the inertia moment in the wind turbines, which can improve its dynamic performance. The validity of this control algorithm has been verified by the simulation of the 2-MW PMSG wind turbine system

Private Sector Corruption in Vietnam: From Legislation to its Impact on the Economy

Purpose: The objective of this study was to analyze Vietnamese legal legislation regarding corruption in the private sector, identify its current shortcomings, and assess its impact on the Vietnamese economy since its adoption in 2018.   Theoretical framework: There have been many studies to assess corruption in Vietnam in many aspects, including the overview of corruption in Vietnam, the influence of corruption on economic development, and the consequences of corruption. However, there is still much to investigate and learn about the impact of the current provisions on corruption in the private sector on Vietnam’s economy.   Design/methodology/approach:  The study uses secondary data from the Provincial Competitiveness Index Report (PCI Vietnam) issued by the Vietnam Chamber of Commerce and Industry (VCCI) in collaboration with the United States Agency for International Development (USAID). Besides, the article analyzes Vietnam's Corruption Control Index (CCI), which is assessed annually by the World Bank (WB). At the same time, the authors refer to the data on Vietnam's GDP and make a comparison with the CC index to  clarify the article’s objective. The authors also use a qualitative method by analyzing previous studies to assess the corruption in the private sector in Vietnam, the rules of law concerning private corruption, and its impact on the economy.   Findings:  Vietnam has had specific legislative achievements in criminalizing private corruption in the 2015 Criminal Law and promulgating anti-corruption provisions in the 2018 Anti-Corruption Law. These regulations had a positive impact on Vietnam's economy. However, corruption in the private sector in Vietnam is quite severe, especially bribery in business.   Research, Practical & Social implications:  We suggest future research of in-depth analysis of the causes and effects of specific kinds of corruption acts in the private sector.   Originality/value:  The results indicate that the new provisions on corruption in the private sector since it was adopted have positively affected the development of Vietnam's economy and the fight against corruption