Characteristics of Corporate Boards in Single-Industry and Conglomerate Media Companies

Abstract

Although there has been much research into corporate governance generally, little attention has been focused specifically on issues in media companies. The question is further complicated by the increasing frequency with which media enterprises that have traditionally operated within the industrial context of a specific medium are becoming business lines for media conglomerates and must compete for resources and strategic attention from a board more concerned with bottom-line profitability than with traditional media industry norms. This study examines board compositions of 21 firms with leadership positions in 1 or more traditional mass media industries and compares governance structure and results for those firms that are concentrated in 1 media segment to those that operate multiple media segments. Relations between skills sets associated with different categories of board members (legal, finance, consumer/marketing, service, academic, and other), management influence, and other board demographics to the creation of shareholder value were identified based on financial measures of market value, earnings per share, and dividend levels. The relations between board characteristics and strategic measures of capital reinvestment, asset sales, and acquisitions were also examined. A number of significant differences were identified between single-industry and conglomerate firms in these dimensions.