BOARD COMPOSITION AND THE COMMISSION OF ILLEGAL ACTS: AN INVESTIGATION OF FORTUNE 500 COMPANIES
Date of this Version
Academy of Management Journal 1986, Vol. 29, No. 4, pp. 789-799.
Corporate boardroom processes and board composition have long been topics of interest and debate for both organizational researchers and practitioners. In recent years, however, criticism of corporate boards has increased dramatically, as evidences by the comments of former International Telephone & Telegraph chairman, Harold Geneen. According to Geneen, "the boards of directors of U.S. industry include numerous first-rate people doing what amounts to a second-rate job" (1984: 258). In defense of his position, he brought up many points, but board composition is the most central to his argument. Essentially, Geneen and other critics have argued that the designs of corporate boards restrict their members; independence and render them ineffective when it comes to monitoring top management and protecting stockholders' interests (Anshen, 1980; Drucker, 1973; Mace, 1971; Mintzberg, 1983).
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