In 2019, 181 CEOs signed a Business Roundtable Statement on the Purpose of a Corporation. The statement reflected a growing sentiment in corporate governance attitudes that the purpose of a corporation extends beyond maximizing shareholder value to maximizing the value for the benefit of all stakeholders—which according to the Statement include “customers, employees, suppliers, communities […]
Read More… from Stakeholder Value: Best for Everyone or Just Poor Performers?
Shareholders can submit complaints to publicly-traded companies on a broad range of topics, including poor financial performance, poor governance, dissatisfaction with the firm strategy, or a controversial change in leadership, to name but a few. These complaints are then discussed at the next meeting. Complaints from shareholders are likely to have a negative impact on […]
Read More… from Advertising Bolsters Firm Value after Shareholder Complaints
With good governance recognized as a key factor in a company’s success, the recruitment of new members to a board is a highly important and consequential task. New research focuses on the often-overlooked criteria of domain expertise — that is, whether having experts in the sector or industry of the company on the board adds […]
Read More… from In Uncertain Times It’s Best to Have Fewer Industry Experts on a Board
When a corporate scandal erupts, the same questions emerge: What was the board of directors doing? How could it let this happen? Why were directors not doing a better job of monitoring corporate management? Failure in corporate governance is often attributed to board members’ incompetence or lack of incentive. After reviewing nearly 300 academic journal […]
Read More… from Why Boards of Directors Fail at Monitoring Their Companies
The ‘legitimacy’ of a company is based on whether outsiders consider that a company takes appropriate actions — and has the governance structures in place to ensure that it continues to take appropriate actions. One measure of legitimacy is the balance of power between the CEO and the board of directors. In general, investors and […]
Read More… from Reducing CEO Power Can Undermine a Company’s Legitimacy
In December of 2005, Norway passed a quota law requiring that women make up a minimum of 40% of corporate boards. Corporations had 2 years to comply with the law. As a result of the law, the fraction of women directors went from 5% in 2001 to 40% in 2008. Opponents of the quota argued […]
Read More… from Quotas to Gender-Balance the Board: Norway’s Drastic Action Worked
Corporate governance systems are the systems through which a company is controlled and directed. Public corporations will have boards of directors responsible for ensuring that management is acting in the best interests of the company. Strategic human resource management (SHRM) is based on the belief that human resource decisions must be aligned with the strategy […]
Read More… from How Corporate Governance Impacts Human Resources
Does a Chief Marketing Officer help a company, or is this position a ‘C’ that doesn’t earn its place in the C-suite? In 2008, an influential research study by Pravin Nath of the Drexel University (now at Oklahoma) and Vijay Mahajan of the University of Texas came to the conclusion that a CMO neither adds […]
The relation of appearance to success is no longer questioned. Various studies have shown that taller (for men) and more attractive (for both men and women) people reach higher levels of leadership, make more money, and are more respected by their peers than less attractive people. These and other measures of success, however, focus on […]
Read More… from How a CEO’s Attractiveness Can Boost Shareholder Value
The digital age creates a wide range of new opportunities for innovation. Examples include new marketing outlets through social media; ‘big data’ information on customers and the market; mobile devices that connect companies to customers 24/7; and apps that redefine business models. However, not all C-suite executives have a digital mindset. As a result, innovation […]
Read More… from CIOs: Coach and Communicate with C-suite for Digital Innovation
