Academic Directors and IPO Initial Returns

Forthcoming in Int. J. Business Governance and Ethics

Posted: 22 Aug 2018

See all articles by Bazeet Badru

Bazeet Badru

School of Economics, Finance and Banking. Universiti Utara Malaysia ; Universiti Utara Malaysia.

Nurwati A. Ahmad-Zaluki

Universiti Utara Malaysia - Othman Yeop Abdullah Graduate School of Business

Wan Nordin Wan-Hussin

Universiti Utara Malaysia - College of Business

Date Written: August 9, 2018

Abstract

This study examines the impact of academic directors on IPO initial returns. With a sample of 208 Malaysian IPOs over the period of 2005 to 2015 and applying a quantile regression (QR) technique, this study finds that the academic directors are significantly and negatively associated with IPO initial returns, indicating IPOs with more directors from the academia can better serve as a signal of a company’s quality. Such directors are perceived by potential investors as intellectuals capable of providing knowledgeable skills in complex decision-making, like IPO, as well as advising and monitoring the management. These findings indicate that IPO issuers can demonstrate their quality through a highly educated board.

Keywords: Academic Directors; Corporate Governance; IPO Initial Returns; Quantile Regression; Malaysia

Suggested Citation

Badru, Bazeet and Ahmad-Zaluki, Nurwati A. and Wan-Hussin, Wan Nordin, Academic Directors and IPO Initial Returns (August 9, 2018). Forthcoming in Int. J. Business Governance and Ethics, Available at SSRN: https://ssrn.com/abstract=3229261

Bazeet Badru (Contact Author)

School of Economics, Finance and Banking. Universiti Utara Malaysia ( email )

Universiti Utara Malaysia
Sintok, Kedah 06010
Malaysia
+60147265986 (Phone)

Universiti Utara Malaysia. ( email )

Sintok, Sintok 06010
Malaysia
+60147265986 (Phone)

Nurwati A. Ahmad-Zaluki

Universiti Utara Malaysia - Othman Yeop Abdullah Graduate School of Business ( email )

Universiti Utara Malaysia
Sintok, Kedah 06010
Malaysia

Wan Nordin Wan-Hussin

Universiti Utara Malaysia - College of Business ( email )

Sintok, Kedah Darul Aman 06010
Malaysia
+604-7003939 (Phone)
+604-7005762 (Fax)

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