Supervision of Independent Directors and Top Executive Turnover: Empirical Evidence from China's Listed Firms Based on Panel Data

Using a sample of Chinese listed firms for the period 2004-2007, we measure the supervision of independent directors with six dimensions. We find that the supervision of independent directors had very significant positive effects on turnover of top executives. We further find that the proportion of independent directors, separation of CEO and Chairman, the number of accounting experts and reputation had important effects on turnover of top executives. The effects of stock holding shares ratio of the biggest boarder were secondary and allowance had relative small influence on it, which reflected that independent directors did not have enough incentive to supervise.