TY - JOUR
T1 - BOARD COMPOSITION FROM A STRATEGIC CONTINGENCY PERSPECTIVE
AU - Pearce, John A.
AU - Zahra, Shaker A.
PY - 1992/7
Y1 - 1992/7
N2 - This study examined the association between corporations’environments, strategies, and past performance and the composition of their boards of directors as measured by size and outside director representation. The environment, strategy and past performance were viewed as posing a strategic contingency; each of these sets could determine the success or failure of the company. Data on 119 Fortune 500 industrial companies for the 1983‐9 period were used. Canonical analysis showed that increased uncertainty of a firm's environment, use of external growth and diversification; reliance on leverage as a means of finance, and poor past financial performance were associated with large board size and increased outside representation in subsequent years. Most important, board composition was positively associated with future measurements of corporate financial performance.
AB - This study examined the association between corporations’environments, strategies, and past performance and the composition of their boards of directors as measured by size and outside director representation. The environment, strategy and past performance were viewed as posing a strategic contingency; each of these sets could determine the success or failure of the company. Data on 119 Fortune 500 industrial companies for the 1983‐9 period were used. Canonical analysis showed that increased uncertainty of a firm's environment, use of external growth and diversification; reliance on leverage as a means of finance, and poor past financial performance were associated with large board size and increased outside representation in subsequent years. Most important, board composition was positively associated with future measurements of corporate financial performance.
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U2 - 10.1111/j.1467-6486.1992.tb00672.x
DO - 10.1111/j.1467-6486.1992.tb00672.x
M3 - Article
AN - SCOPUS:85025226022
SN - 0022-2380
VL - 29
SP - 411
EP - 438
JO - Journal of Management Studies
JF - Journal of Management Studies
IS - 4
ER -