Home‎ > ‎

Job Market Paper

"Tenure on Corporate Boards and Corporate Governance"

It is unclear how the length of tenure of directors on corporate boards is related to the board’s purpose of overseeing firm management. I provide insight to the relationship using a sample of corporate directors for firms in the S&P 1500 for the period 1996–2017. I find that director tenure influences membership on three important committees. I find that boards with high median tenure are more likely to overstate financial statements and tend to provide a smaller level of total compensation to the CEO. However, tenure is not related to subsequent appointments to the board. Finally, I show that board tenure is related to the market and accounting performance of the firm, as measured by Tobin’s Q and the firm’s return on assets, accounting for endogeneity of board tenure using instrumental variables.
Ċ
Benjamin Posmanick,
Nov 22, 2019, 7:20 AM
Comments