How director identification shapes accountability and scope of contribution

Natalie Elms and Gavin Nicholson

Accounting, Auditing & Accountability Journal, 2020, vol. 33, issue 8, 1815-1834

Abstract: Purpose - The purpose of this paper is to explore why different directors feel different levels of accountability toward board tasks. Design/methodology/approach - The paper employs a reflexive three wave data and analysis process culminating in a rich data set of 49 interviews with Australian directors and 15 h of boardroom observations. Findings - Differences in role identification lead directors to perceive their accountability differently resulting in wide variation in levels of firm specific knowledge, eventually affecting their breadth of contribution to board tasks. Research limitations/implications - Researchers should question the application of traditional governance theory (such as agency theory) if it fails to account for individual differences in intrinsic self-interest. Practical implications - Selecting board members for their functional knowledge alone may not always produce optimal outcomes for the board and firm. Board induction processes and ongoing director training are important tools to inform and remind directors of their role and accountabilities on a board. Originality/value - This paper establishes that the strength of directors' identification with either the director role or expert role affects what they feel accountable for, the development of firm specific knowledge and long-term efficacy as a director.

Keywords: Accountability; Corporate governance; Role identity; Boards of directors (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eme:aaajpp:aaaj-12-2019-4358

DOI: 10.1108/AAAJ-12-2019-4358

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