Publication Type

Conference Paper

Publication Date



This paper investigates the impact of social ties between the Chief Executive Officer (CEO) andboard members on corporate risk-taking in mergers and acquisitions (M&As) and on shareholdervalue. Using a measure of CEO-director connections in a large sample of U.S. firms from 2000 to2010, we document that boardroom connections lower firm acquisitiveness. If connected CEOsundertake M&As, they are less likely to choose focus acquisitions, and more likely to pay in stock.CEO-board connections do not enhance firm value in M&As. Higher levels of boardroomconnection are associated with lower announcement returns and lower subsequent return on assets.Our results are robust to alternative explanations and various robustness checks.


Social networks, mergers and acquisitions, corporate risk-taking, CEO, board of directors


Corporate Finance | Strategic Management Policy

Research Areas



SMU-SKBI Brown Bag, 06 August 2012, Singapore; Financial Management Association Doctoral Consortium, 17 October 2012, Atlanta


World Scientific

City or Country

Atlanta, GA

Creative Commons License

Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.