This paper examines how cross-listing affects firm value through changes in the foreign independent director composition of corporate boards. Using a novel dataset of directors’ foreign experience and nationalities in Chinese listed firms, we find a significant increase in high-quality foreign independent directors after cross-listing. The presence of foreign independent directors on the board is positively associated with firm value and foreign sales. The market reaction to their appointment announcements in cross-listed firms is positive. Our evidence suggests that improving the board composition is an economic channel for the valuation premium of cross-listing.​

JEL classification: G15, G34
Keywords: Cross-listing, Foreign independent director, Board quality, Board of directors