Do staggered boards benefit the environment? A plant-level analysis

This study provides evidence demonstrating a negative relationship between the implementation of staggered boards, designed to safeguard managers against the corporate control market, and the occurrence of toxic chemical releases. By examining a quasi-natural experiment facilitated by a 1990 law enforcing staggered boards for Massachusetts-incorporated firms, we ascertain that the compulsory adoption of staggered boards leads to a significant reduction in toxic emissions. Our findings suggest that staggered boards are more effective in reducing emissions when managers have greater job security. Additionally, the impact is stronger in younger firms and those with superior governance practices. Overall, these results align with the long-term perspective that staggered boards can promote.