Abstract: Although strategic leadership and governance scholars have long focused on understanding director effectiveness, it remains a complex and nuanced undertaking. In this regard, recent work increasingly suggests potential negative consequences of deficient and/or excessive director monitoring and/or resource provisioning in terms of how it may influence CEO behavior and actions, as well as organizational performance. We build on these suggestions and articulate psychological contract framework of director effectiveness. Concretely, adopting the CEO’s point-of-view, we regard director monitoring and resource provision functions as promised and delivered inducements that influence how a CEO may perform his or her tasks and job. This novel theoretical stance allows us to articulate how misalignment (i.e. deficiencies or excesses) between promised and delivered director monitoring and/or resource provisioning may influence CEO behavior and actions in unsuspecting ways. We build on these developments to outline an agenda for future research and suggest noteworthy implications for practice.

Abstract: Investigating the influence that a board of directors has on firm performance remains a central area of interest in the governance literature. However, little is known about the relationship between the functional backgrounds of board members and the attention the board gives to financial versus strategic controls during board meetings. In this proposed study, we will examine this relationship by analyzing hundreds of transcripts from board meetings for 230 firms over a 20 year time period. In addition, we will test the effects of deviation from prior firm performance as a moderator of this relationship. Finally, our study will shed further light on the relationship between the type of controls attended to by the board of directors and firm performance.

Abstract: This study provides a theoretical and empirical analysis of how, why, and when outside directors shape firm strategy. We blend insights from research on corporate governance and human cognition to propose that director influence is a function of their combined routine and adaptive expertise, which we define and measure in terms of the complementary aspects of an individual director’s experiences. We use this notion of blended expertise to identify a priori the individual directors whose optimal level of expertise makes them the most likely ‘movers and shakers’ of firm strategy, and we specify the moderating role played by the source and timing of expertise acquisition, and by the context of expertise transfer. We discuss implications to research on director selection, director expertise, and firm strategy.

Abstract: Corporate governance researchers have long assumed that inside directors are unlikely to detect managerial opportunism. In contrast, we relax this assumption by suggesting that certain inside directors can in fact be effective monitors and help lower agency costs. By using social exchange theory and relying on the literature on corporate elites, we identify factors that make non-CEO inside directors likely to alleviate one common type of agency problem – the CEO’s personal use of corporate aircraft. In a sample of 131 low-performing Fortune 1000 firms, our results show that the CEO’s personal use of corporate aircraft is lower when (1) a greater proportion of non-CEO inside directors are appointed to the board before the incumbent CEO took office and (2) when non-CEO inside directors are younger.