Board composition and CEO power

• 成果类型: Article
• 署名作者: Baldenius, Tim; Melumad, Nahum; Meng, Xiaojing
• 署名单位: Columbia University
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2013.10.004
• 发表日期: 2014
• 页码: 53-68
• 关键词: CORPORATE GOVERNANCE; CEO power; BOARD COMPOSITION

摘要

We study the optimal composition of corporate boards. Directors can be either monitoring or advisory types. Monitoring constrains the empire-building tendency of chief executive officers (CEOs). If shareholders control the board nomination process, a non-monotonic relation ensues between agency problems and board composition. To preempt CEO entrenchment, shareholders may assemble an adviser-heavy board. If a powerful CEO influences the nomination process, this may result in a more monitor-heavy board. Regulations strengthening the monitoring role of boards can be harmful in precisely those cases in which agency problems are severe or in which CEO entrenchment is a threat to corporate governance. (C) 2014 Published by Elsevier B.V.