Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/258446 
Year of Publication: 
2021
Citation: 
[Journal:] Journal of Risk and Financial Management [ISSN:] 1911-8074 [Volume:] 14 [Issue:] 8 [Article No.:] 342 [Publisher:] MDPI [Place:] Basel [Year:] 2021 [Pages:] 1-21
Publisher: 
MDPI, Basel
Abstract: 
The board of directors plays an important role in implementing corporate governance in the firm, as directors have a fiduciary duty to the firm's shareholders. The effectiveness of directors is a key determinant of corporate value and they need to bring a range of skills and experience to the boardroom. This skill and experience cannot be developed solely within the firm, and most boards incorporate non-executive directors who are or have been directors of other firms. Current research on the benefits of interlocking directorships is mixed between the claim that they bring outside feedback to the table and open decision makers' minds, and those who think outside directors are a waste of money and can reduce company performance. This paper investigates the extent of interlocking directorship in New Zealand and how it affects corporate performance. Our findings of largely no significant impact on firm performance are consistent with the management control theory of director interlocks; the exceptions support the class hegemony theory that links interlocking directorship with a negative firm performance.
Subjects: 
board of directors
company performance
interlocking directorship
New Zealand
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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