To protect minority shareholder’s interest, corporate governance codes in most of markets tend to raise the requirement of minimum numbers of independent directors for listed firms. Under the limited supply of qualified directors in mainland China, however, more and more independent directors hold multiple directorships simultaneously. According to “busyness hypothesis” or “quality/reputation hypothesis”, multiple directorships may hamper or improve the efficiency of independent director, and thereby affect the firm performance. However, Chinese firm board composition is unique among the world, with a majority of independent directors with academic backgrounds. This paper will investigate the effect of independent directors’ multiple directorships on firm value using the sample of companies listed in Shanghai Stock Exchange (SSE) and Shenzhen Stock Exchange (SZSE). The analysis involves the independent directors’ characteristics, such as education level, professional background and political connection, which are expected to strengthen or mitigate the effect of multiple directorships due to the unique culture and institutions in China. Furthermore, to deal with possible endogenous problem, we use instrumental variables approach to mitigate this problem. This paper may derive important policy implication for corporate governance reform for China and other emerging markets, and contribute to the controversial topic about the “busyness” and “reputation” effect of multiple directorships.