Role Of Board Members Research Articles

Co‐opted Independent Directors and Firms' Environmental Performance

ABSTRACTResearch Question/IssueConsidering escalating environmental concerns and the important role of board members in shaping strategic corporate decisions, we investigate the relationship between co‐opted independent directors and firms' environmental performance.Research Findings/InsightsExamining US firms from 2002 to 2018, we document a significant negative relationship between co‐opted independent directors and firm environmental performance. Our findings show that while institutional ownership and CEO power exacerbate the negative association, strong corporate governance mitigates this negative impact of co‐opted independent directors on environmental performance. The cross‐sectional results show that the relationship is pronounced in firms with young CEOs, male CEOs, and low CEO compensation. Further, the relationship is also prevalent in boards with fewer meetings, high multiple directors, and higher compensation, indicating a monitoring compromise by independent co‐opted directors.Theoretical/Academic ImplicationsReasonable theoretical arguments are drawn from agency theory and the theory of friendly boards, and our statistical analysis supports the academic position of the theory of friendly boards. The negative effect of independent co‐opted directors on firm environmental performance challenges the role of independent directors in addressing agency issues in environmental efforts, hinting at a departure from conventional agency theory expectations.Practitioner/Policy ImplicationsTo improve environmental performance, firms should reconsider their board structures, acknowledging the potential drawbacks of co‐opted independent directors. Our findings challenge the Sarbanes–Oxley Act's (SOX) emphasis on increasing the number of outside directors, which assumes independent board members will rigorously oversee executives. Such legislation is greatly based on the premise that independent board members strictly monitor executives. However, our findings indicate that not all independent directors are strict monitors, as demonstrated by lower environmental performance when there are more co‐opted independent directors.

Do employees’ perceptions of diversity management enhance firm’s financial performance: the moderating role of board members’ diversity level

PurposeThe hospitality industry has one of the most diversified workforces. This study aims to examine the effect of employees’ perceptions toward diversity management on the company’s financial performance. The current study also examines the moderating effect of board members’ diversity level on the association between employees’ perceptions and financial outcomes.Design/methodology/approachFrom online reviews, the authors identified multi-faucets of diversity management and measured employees’ perceptions of diversity management. Using panel data analysis, the relationships among employees’ perceptions, board members’ diversity level and companies’ financial performance were studied.FindingsThis study found that employees’ perceptions of diversity management positively influence the company’s financial performance and the relationship was positively moderated by board members’ diversity level.Practical implicationsFindings show that hospitality employees perceive nine diversity and inclusion categories (age, organizational climate, culture, disability, education, gender, physical differences, policy and practice and race) that companies need to consider when developing and implementing diversity management. Moreover, practitioners need to eliminate the gap between board members and employees when applying diversity management.Originality/valueDrawing upon service–profit chain theory, this study extends hospitality literature regarding diversity management by demonstrating how employees perceive working environments created by diversity management affects the organizational financial outcome. Moreover, this study emphasizes the exemplary role of board members as policy and practice makers, to provide employees with the legitimacy and responsibilities of diversity management.

Engage Your Board as Fundraising Allies

Successful FundraisingVolume 31, Issue 5 p. 4-4 Board Member Roles Engage Your Board as Fundraising Allies First published: 06 April 2023 https://doi.org/10.1002/sfr.32159Read the full textAboutPDF ToolsRequest permissionExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL No abstract is available for this article. Volume31, Issue5May 2023Pages 4-4 RelatedInformation

Methodology for conducting a comprehensive product review in managed care.

The high degree of complexity of the product-review process and differences in procedures between organizations have resulted in a need for best practices and an overall product-review process to create efficiencies for health care decision makers. In an effort to streamline product-review concepts, this article outlines the different components of the review process, including clinical and economic review, formulary placement determination, and evaluation of alternatives within a drug class. The article also details opportunities for the near future, as technology continues to advance and alignment between medical and pharmacy benefits is desired. DISCLOSURES: Drs Linnerooth, Penley, Ha, and Craven report employment with Xcenda, which provided funding for the manuscript. Drs Sauvageau and Hydery report employment Xcenda, which provided funding for the manuscript, and stock holdings with AmerisourceBergen. Dr Feeney reports support for attending meetings and/or travel provided by Highmark, Inc. Dr Thomas reports receipt of consulting fees from ActiveRADAR, board member roles with ActiveRADAR and RoundtableRx, an adjunct professor role with the University of Minnesota, and stock options and pensions with Eli Lilly and Aetna/CVS. Dr Watkins reports payment or honoraria from ISPOR and for articles written for Value and Outcomes Spotlight, and support for attending meetings and/or travel by AMCP.

Creation of a pharmacy leadership certificate program for pharmacists and pharmacy technicians using an innovative, low-cost framework.

To describe the creation of a statewide leadership training program for practicing pharmacists and pharmacy technicians. The 2 overarching goals were to (1) enable learners to develop foundational leadership skills that could be used at their place of work or would enable them to take on a new or advanced role and (2) help foster sustainability within our state pharmacy society through incorporation of the learners on committees and projects, bringing awareness to board member roles and functions. Overall, the program's mission was to empower practicing pharmacists and pharmacy technicians to take on leadership roles within their organization and the state pharmacy society. Leadership training for pharmacists and pharmacy technicians can be variable, elusive, and costly. We provide our experiences in establishing a 1-year leadership certificate program affiliated with the state pharmacy society. In the first 4 years, a total of 15 program fellows have graduated, with 8 more set to finish in September 2022. Since completion of the program, a majority of the graduates have taken on new leadership positions (65% have accepted new leadership positions and 35% have been elected to state pharmacy society board positions). Implementation of a statewide pharmacy leadership program provided a low-cost, high-value option to develop local leaders, in affiliation with a state pharmacy society.

Understanding the Effectiveness of Co-operative Board Members from Resource Dependence and Participation Perspective: A Proposal of Conceptual Framework

Co-operatives played a critical part in the community development initiative, and its viability is reliant on the board members' ability to carry out their roles effectively. Since board members are a vital body of the cooperative's internal governance, it is important to examine how they affect the cooperative's performance. Several factors have been proposed and based on prior research inferences, the majority of which have used the concept of corporate governance to identify the factors that influence the cooperative board's effectiveness, which has also been adopted in this article. Owing to the inconsistent findings and gaps in previous research, this article has focused on the role of board members' human and social capital in affecting cooperative performance. The research also presented board participation as a mediator between human and social capital and cooperative performance. This study employs resource dependence and participation theory as underpinning theories to support its assumptions and performs a literature review to synthesize empirical findings on related factors. SmartPLS software will be used to analyze the data and explore all relationships using Structural Equation Modeling (SEM).

The role of board members’ networks in acquiring and using information for outsider CEO selection

Outsider CEO selection is one of the most difficult decisions for boards due to lack of information for evaluating suitable candidates. We hypothesize and find evidence that boards use their professional networks to obtain information about outsider CEO candidates in a sample of 318 outsider CEO appointments in S&P 1500 firms from 2004-2013. Our hypothesis that direct ties provide more reliable information and are thus more likely to lead to a candidate being selected than indirect ties was supported. We did not find support for the hypothesis that ties to members of the nominating committee or to more senior board members increase the likelihood of being selected, which indicates that in outsider CEO selection information quality matters more than individual board members’ role or status.

Examining Individual Board Member Behaviors in Nonprofit Sport Governing Bodies

Research on individual board members has tended to focus on attitudes and personal characteristics with research on behaviors limited to the fulfillment of prescriptive tasks. This article develops a nine-behavior model of board member behavior using three board member roles (individual, board, and organizational) and three types of behavior (proficient, adaptive, and proactive). The model was tested using survey data acquired from Canadian provincial sport governing bodies. The data did not support adaptive behaviors, but a revised model was supported by the data. The results suggested board members perceive expectations to fulfill individual tasks, work together, and implement positive change. This research provides an empirically tested framework for continuing the advancement in governance research beyond a structural and compositional approach to an approach that captures the social and behavioral nature of boards.

Peran Wakil Rakyat Dalam Pembangunan di Daerah Pemilihan Sumenep

This research was conducted to find out how the role of people's representatives in fighting for the aspirations of the people represented based on electoral districts (Dapil) in development. This research uses descriptive qualitative method, by collecting data through direct observation in the field (observation) and in-depth interviews (in-depth interviews) with various informants related to the study. The rationale in this research is the theory of political representation (representation), which analyzes how the roles, duties and functions of people's representatives. From the results of the study found the role of people's representatives who fight for the aspirations of the community in the form of escorting grant assistance programs to community groups, both social and empowerment (budgeting function). Besides other forms of role carried out by the people's representatives is the function of supervision (control) of government programs, such as the implementation of the distribution of rice to prosperous families (rastra), the implementation of construction of school buildings, and others. The role of board members who are still not maximized is related to the function of the budget (budgeting), especially in the field of infrastructure. This is clearly seen from the unfinished construction of road infrastructure and health infrastructure in the Kangean Islands and Sapeken areas.

Boards of Directors: Assessing Their Functioning and Validation of a Multi-Dimensional Measure.

Boards of Directors that function effectively have been shown to be associated with successful organizational performance. Although a number of measures of Board functioning have been proposed, very little research has been conducted to establish the validity and reliability of dimensions of Board performance. The aim of the current study was to validate the measurement properties of a widely-used model and measure of Board performance. Exploratory Factor Analysis (EFA) and Confirmatory Factor Analysis (CFA) were conducted on online survey data collected from 1,546 board members from a range of Australian organizations. The analyses yielded 11 reliable factors: (1) effective internal communication and teamworking (2) effective leadership by the Chair (3) effective committee leadership and management (4) effective meeting management and record keeping, (5) effective information management (6) effective self-assessment of board functioning (7) effective internal performance management of board members (8) clarity of board member roles and responsibilities, (9) risk and compliance management (10) oversight of strategic direction, and (11) remuneration management. These dimensions to a large extent correspond to previously suggested, but not widely tested, categories of effective Board performance. Despite self-reported data and a cross-sectional design, tests of common method variance did not suggest substantive method effects. The research makes significant contributions to the corporate governance literature through empirical validation of a measure shown to reliably assess 11 discrete dimensions of Board functioning and performance. Practical and theoretical implications, study limitations and future research considerations are presented.

How does a board of directors influence within‐ and cross‐sector nonprofit collaboration?

Board members play a significant, yet largely unexamined, role in nonprofit collaboration. Processes, such as finding prospective partners, creating common ground with a partner, and establishing appropriate collaborative governance implicate nonprofit board members. In contrast to the scholarship of the role of interlocking directorates as potential networks for nonprofit collaboration, this paper examines the role of board members' social and human capital on nonprofit collaboration with other nonprofits, businesses, and government agencies. Drawing on online survey data from 636 nonprofit organizations, this paper finds that board social capital—but not board human capital—is positively related to the presence and number of within‐sector and cross‐sector nonprofit collaboration. However, board human capital enhances nonprofit‐government collaboration, when board social capital is also high. The results provide a novel perspective in nonprofit collaboration and board management research.

Impact of Corporate Governance on Banks Financial Performance

Purpose: The purpose of this study is to examine the impact of corporate governance on the financial performance of financial institutions in London city with emphasis on board role and composition, transparency and disclosure, audit and compliance and the risk management as indicators of corporate governance and profitability, liquidity and loan portfolio taken as proxies for financial performance. Design/methodology/approach: A sample of 20 financial institutions was selected and from each selected, 10 respondents were selected giving a total sample size of 200. The Principal Component Analysis (PCA), with inbuilt ability to check for composite reliability, was used to obtain composite indices for governance indicators as well as the indicators of financial performance, based on the set of questions framed for each of them. Findings: The results revealed that all indicators of corporate governance positively influence the financial performance of financial institutions. However, whereas the effect of auditing and compliance, transparency, disclosure and risk management were found to be significant in their influence on financial performance, board role and composition turns out to be insignificant. As such, policy prescriptions are proposed towards redefining the role of board members while enforcing accountability and transparency. Practical implications: This paper demonstrates the importance of transparency and disclosure in the managerial affairs, the financial performance of financial institutions through loan portfolio, liquidity and profitability increases by 0.4 with such effect being statistically relevant at 1%. Originality/value: The use of primary data in assessing the impact of corporate governance rather than just using secondary data forms the novelty of this study. In addition, we use principal component analysis (PCA) to assess the weight of various parameters.

The Board Value Protection Function in Young, Mature and Family Firms

AbstractNext to value creation, the value protection function of the Board of Directors is a widely accepted fact. Nevertheless, the current literature struggles to show a positive impact of the Board Value Protection (BVP) on firm performance. We use the decision rights model of board functions and argue the difference between board member roles (insider vs independent) and functions, to isolate the BVP from other director functions. By using the German context as a natural setting, we can isolate the BVP and show how it evolves with the firm lifecycle and owner motivations. Based on a sample of 446 initial public offerings (IPOs) from 1995 to 2015, our results show that the importance of BVP in young firms decreases with age, increases in mature firms and that this effect is stronger in family firms.

Corporate Governance as a Key Driver of Corporate Sustainability in France: The Role of Board Members and Investor Relations

This paper examines the relationships between corporate governance and corporate sustainability by focusing on two main components of companies’ governance structure: boards of directors (BoDs) and investor relations officers (IROs). We propose an original empirical strategy based on the 120 biggest French capitalizations for the year 2013, allowing us to measure boards of directors’ independence and expertise, as well as investor relations officers’ convictions and communication on corporate sustainability. Our results show that corporate governance has an ambiguous impact on corporate sustainability because of opposing forces: internal, external and intermediate forces. On the one hand, the higher the proportion of inside directors, the higher the company’s environmental and governance performance, while the higher the proportion of general experts in the board room, the lower the company’s governance performance. On the other hand, investor relations officers’ beliefs that corporate sustainability is primarily driven by investors’ ethical values appear negatively related to companies’ governance performance. In sum, corporate sustainability appears positively related to internal forces (inside directors) and negatively related to external forces (general expert directors and investor activist engagement). The results of this study demonstrate the need to carry out efforts to train BoDs (specifically inside directors) and IROs to respond to corporate sustainability and to take more of a leadership role in this area.

Board members in squeeze-out transactions: an event study analysis

In this study, we investigate the role of board members in German squeeze-out transactions by applying the event study methodology. We find that a dismissal of a management board member is associated with lower cumulative abnormal returns in the period of three months preceding the squeeze-out announcement. This indicates that minority shareholders receive a lower compensation if management board members are dismissed prior to the squeeze-out announcement. Though we are cautious to draw inferences from this finding, we follow other scholars (e.g., Daske et al., 2010) and suggest that majority shareholders exploit their superior status and use its power opportunistically. We furthermore explore the effects of directors' dealings in a squeeze-out transaction. We find that if stock purchases take place in a period of one year preceding the announcement, abnormal returns tend to be lower in the run-up period and higher on the announcement date.

Board members in squeeze-out transactions: an event study analysis

In this study, we investigate the role of board members in German squeeze-out transactions by applying the event study methodology. We find that a dismissal of a management board member is associated with lower cumulative abnormal returns in the period of three months preceding the squeeze-out announcement. This indicates that minority shareholders receive a lower compensation if management board members are dismissed prior to the squeeze-out announcement. Though we are cautious to draw inferences from this finding, we follow other scholars (e.g., Daske et al., 2010) and suggest that majority shareholders exploit their superior status and use its power opportunistically. We furthermore explore the effects of directors' dealings in a squeeze-out transaction. We find that if stock purchases take place in a period of one year preceding the announcement, abnormal returns tend to be lower in the run-up period and higher on the announcement date.

Pay Attention to Board Member Roles in Fundraising

Pay Attention to Board Member Roles in Fundraising

Board member roles and responsibilities quiz

Is it a board member's place to perform the following actions?

Serving on Organizational Boards: What Nurses Need to Know

If you have ever thought about serving on a board or being actively involved in meetings aimed at making policy decisions, but are not sure you have the knowledge, skills or abilities to serve competently, this article is for you! In this article, the authors describe six competencies needed by nurses who are serving on boards and/or policy committees so as to contribute in a productive manner. These competencies include a professional commitment to serving on a governing board; knowledge about board types, bylaws, and job descriptions; an understanding of standard business protocols, board member roles, and voting processes; a willingness to use principles for managing and leading effective and efficient board meetings; an appreciation for the ethical and legal processes for conducting meetings; and the ability to employ strategies for maintaining control during intense/uncivil situations. They also discuss strategies for demonstrating these competencies and describe personal responsibilities of board members. The authors conclude that a knowledge of these rules and standards is essential in order for nurses to assume leadership roles that will enhance the health of today’s and tomorrow’s societies.

Roles of Private Club Volunteer Leaders: An Exploratory Study of Content Analysis

ABSTRACTThis study utilized content analysis to identify themes related to the roles of board members from the perspectives of 218 general managers and chief operating officers, all members of the Club Managers Association of America. A computer-assisted program helped identify three main themes of board roles from open-ended responses, namely: (a) internal relations and accountability; (b) strategy planning and policy making; and (c) external relations and accountability. Internal relations and accountability was the most frequently mentioned theme representing 57% of the responses and indicating the most productive contributions of board members to the private clubs. This study also explores the relationships of these themes across club types, club size, and club’s financial performance. Implications and future research directions are also presented.