Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/208452 
Year of Publication: 
2002
Series/Report no.: 
Working paper No. 3-2002
Publisher: 
Copenhagen Business School (CBS), Department of Economics, Frederiksberg
Abstract: 
In a world where corporate boards are not required by law, I identify a governance and a distribute motive for board establishment and board composition. I investigate the presence of these motives in a sample of 23.000+ closely held corporations. Board frequency increases with more owners, if control is diluted and in larger firms. Given firms have a board, non-controlling owners are more likely to be on the board when controlling owners are more powerful. Finally, consistent with an equilibrium interpretation of strategic board establishment, I find little effect of the presence of boards on performance. I conclude that both motives are significant and discuss related corporate governance implications.
Subjects: 
Boards
governance
distributive conflicts
ultimate ownership
JEL: 
G30
L22
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Working Paper

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