Can Independent Directors Influence the Diversified Mergers and Acquisitions Decisions of Listed Companies?

The independent director is an important part of the the governance system of listed companies. It is generally believed that the independent director has three functions: supervision, consultation and relationship resources provision, which can influence the major decisions of listed companies. Taking the mergers and acquisitions events of listed companies from 2013 to 2016 as samples, this paper studies the influence of independent directors on the decision-making of diversified mergers and acquisitions of listed companies. The research finds that the supervision function of independent directors can restrain the impulse of diversified mergers and acquisitions of listed companies. Independent directors with financial and legal backgrounds also keep a cautious attitude to the diversified merger decision of listed companies. The ability of independent directors to provide resources has no significant influence on the decision-making of diversified merger and acquisition of listed companies. The research in this paper preliminarily finds the correlation between the functional orientation of independent directors and the diversified mergers and acquisitions decision of listed companies, which has practical significance for further improving the independent director system of listed companies and standardizing the governance structure of listed companies.