Abstract
This study examines the impact of board busyness (busy directors) on future stock prices crash risk. Using a large sample of Indian firms, we find that board busyness reduces future stock prices crash risk. We attribute this finding to the effectiveness of board busyness since busy directors are more experienced. We also show that busy boards are effective in standalone firms compared to firms affiliated with a business group. Lastly, we find that busy boards are positively associated with conditional accounting conservatism and therefore, accounting conservatism reduces stock prices crash risk. Overall, our results conclude that experienced directors do matter for effective monitoring in emerging stock markets.
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