The road to directorship: How corporate executives secure positions on other firm's boards

Richard H. Lester, Albert A. Cannella

Research output: Chapter in Book/Report/Conference proceedingConference contribution

3 Scopus citations

Abstract

The role of outside directors in the corporate governance process has received well publicized attention from academic research, the business/financial press, and politicians. However, which individuals serve as outsiders from the executive ranks and which types of firms they join is less well understood. Since outside directors are critical to effective corporate governance we seek to better understand those who serve. Using theories of legitimacy, signaling, and prestige we investigate the circumstances surrounding outside director appointments and seek to clarify why we observe certain individuals joining boards as outside directors. We examine the phenomenon of outside directorships through an executive's home firm career, prestigious affiliations, and the firms which employ them as outsiders. In general, we find significant differences between those executives who join their first board vs. those who go on to become outside directors on more than one firm. In addition, home firm performance is not a reliable indicator of who serves as an outsider.

Original languageEnglish (US)
Title of host publicationAcademy of Management 2005 Annual Meeting: A New Vision of Management in the 21st Century, AOM 2005
StatePublished - 2005
Event65th Annual Meeting of the Academy of Management, AOM 2005 - Honolulu, HI, United States
Duration: Aug 5 2005Aug 10 2005

Other

Other65th Annual Meeting of the Academy of Management, AOM 2005
CountryUnited States
CityHonolulu, HI
Period8/5/058/10/05

Keywords

  • Governance
  • Outside directors
  • Signaling

ASJC Scopus subject areas

  • Information Systems and Management

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