Book chapter
Are Busy Boards Effective Monitors?
Corporate Governance
07 Nov 2012
Abstract
Firms with busy boards, those in which a majority of outside directors hold three or more directorships, are associated with weak corporate governance. These firms exhibit lower market-to-book ratios, weaker profitability, and lower sensitivity of CEO turnover to firm performance. Independent but busy boards display CEO turnover-performance sensitivities indistinguishable from those of inside-dominated boards. Departures of busy outside directors generate positive abnormal returns. When directors become busy as a result of acquiring an additional directorship, other companies in which they hold board seats experience negative abnormal returns. Busy outside directors are more likely to depart boards following poor performance.
Metrics
22 Record Views
23 citations in Scopus
Details
- Title
- Are Busy Boards Effective Monitors?
- Creators
- Eliezer M. Fich - Drexel UniversityAnil Shivdasani - University of North Carolina
- Publication Details
- Corporate Governance
- Publisher
- Springer Berlin Heidelberg; Berlin, Heidelberg
- Resource Type
- Book chapter
- Language
- English
- Academic Unit
- Finance
- Scopus ID
- 2-s2.0-84949179658
- Other Identifier
- 991019173692104721