What do Boards Really Do? Evidence from Minutes of Board Meetings

Miriam Schwartz-Ziv and Michael Weisbach

No 17509, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We analyze a unique database from a sample of real-world boardrooms - minutes of board meetings and board-committee meetings of eleven business companies for which the Israeli government holds a substantial equity interest. We use these data to evaluate the underlying assumptions and predictions of models of boards of directors. These models generally fall into two categories: "managerial models" assume boards play a direct role in managing the firm, and "supervisory models" assume that boards' monitor top management but do not make business decisions themselves. Consistent with the supervisory models, our minutes-based data suggest that boards spend most of their time monitoring management: 67% of the issues they discussed were of a supervisory nature, they were presented with only a single option in 99% of the issues discussed, and they disagreed with the CEO only 3.3% of the time. In addition, managerial models describe boards at times as well: Boards requested to receive further information or an update for 8% of the issues discussed, and they took an initiative with respect to 8.1% of them. In 63% of the meetings, boards took at least one of these actions or did not vote in line with the CEO.

JEL-codes: G3 L2 (search for similar items in EconPapers)
Date: 2011-10
New Economics Papers: this item is included in nep-bec, nep-cis and nep-hme
Note: CF LE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published as “What do Boards Really do? Evidence from Minutes of Board Meetings” (with Miriam Schwartz- Ziv), Journal of Financial Economics, Vol. 108 (May 2013), pp. 349-366.

Downloads: (external link)
http://www.nber.org/papers/w17509.pdf (application/pdf)

Related works:
Working Paper: What Do Boards Really Do? Evidence from Minutes of Board Meetings (2011)
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:nbr:nberwo:17509

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w17509

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().