| Summary: | 碩士 === 長榮大學 === 經營管理研究所 === 100 === In this essay, we examine the departure of independent directors among Taiwanese publicly listed firms between 2002 and 2010. We inspect if the departure rate of independent directors is related to (1) financial performance, (2) board composition, (3) ownership structure and (4) deviation of control and cashflow right. With subset samples, we further examine if diverse results are existed when the recruitment of independent directors on board is mandated. Based on dataset in 2002-06 period, we find that the ROA in previous year (accounting restatements) is negatively (positively) associated with the rate of departures. This result implies that deteriorating financial quality is related to the departures. We also find the outside institutional investors’ shareholding is negatively related to departure rates. Our findings support the independent directors’ role for intense monitoring based on agency theory. A further interesting finding is that except accounting restatements, the other variables turned insignificant during the 2007-10 periods, the period that hiring independent directors is mandatory for all listed firms. The finding may imply that the monitoring pressure on independent directors turns into indifferent when having independent directors on board is not voluntary.
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