Board Composition and Organizational Performance: Two Studies of Insider/outsider Effects

John A. Wagner, J. L. Stimpert and Edward I. Fubara

Journal of Management Studies, 1998, vol. 35, issue 5, 655-677

Abstract: This paper presents two studies that examine the commonly held belief that corporate boards are more likely to have positive effects on organizational performance when composed of outside directors. The first study – a meta‐analysis of 63 correlations – indicates that, on average, the greater presence of outsiders is associated with higher performance, but so too is the greater presence of insiders. Instead of providing evidence of a positive outsider effect, these results suggest the existence of a curvilinear homogeneity effect in which performance is enhanced by the greater relative presence of either inside or outside directors. The second study – a hierarchical polynomial regression analysis of data from 259 large US companies – confirms the existence of a curvilinear relationship between insider/outsider composition and performance measured as return on assets.

Date: 1998
References: Add references at CitEc
Citations: View citations in EconPapers (24)

Downloads: (external link)
https://doi.org/10.1111/1467-6486.00114

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jomstd:v:35:y:1998:i:5:p:655-677

Ordering information: This journal article can be ordered from
http://www.blackwell ... s.asp?ref=00022-2380

Access Statistics for this article

Journal of Management Studies is currently edited by Timothy Clark, Steven W. Floyd and Mike Wright

More articles in Journal of Management Studies from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().