SSRN-Corporate Governance Systems and Firm Value: Empirical Evidence for the Value of Committee Systems with Outside Directors by Robert Eberhart:
"The paper presents evidence that the adoption by Japanese firms of a shareholder-centric, more transparent, system of corporate governance creates greater corporate value in comparison to the traditional system.... The effect is not only significant, it is important in magnitude. This paper takes advantage of the unique opportunity afforded by Japan’s introduction of a dual system of corporate governance in 2003, when companies were offered a choice to adopt a new system incorporating outside directors on governing committees. Data analysis shows a significant increase in firm valuation as measured by Tobin’s q, for companies that adopted the committee system, even though comparative financial data show little difference. This finding is attributed to signal sending, as companies who adopted this system signal a choice toward transparency and openness."