This paper examines whether links between inside and outside directors have an impact on CEO compensation. Using a comprehensive sample of 22,074 directors for 3,114 firms, we develop a measure of the " back door " distance between each pair of directors on a company's board. Specifically, using the entire network of directors and firms, we compute the minimum number of other company boards tha...

We study how the pre-existing social network ties between the CEO and outside board members are associated with the firms’ voluntary financial disclosure practices, proxied by management earnings guidance. We construct social network ties by considering the social ties in addition to the statutory ties. After controlling firm and year fixed effects, we find a substantially strong, negative rela...

This study draws on prior research on corporate governance and examines whether the informativeness of earnings, proxied by the earnings±returns relationship, varies with the fraction of outside directors serving on the board and board size. The results suggest that earnings of ®rms with the smallest boards in the sample (with a minimum of ®ve board members) are perceived as being more informat...

Reformists argue that Japanese firms maintain inefficiently few outside directors, while theory suggests market competition should drive firms toward their firm-specifically optimal board structure (if any). The debate suggests three testable hypotheses. First, perhaps board composition does not matter. If so, then firm performance will show no relation to board structure, but outsiders will be...

This paper examines the effects of director labor markets at firm headquarter locations on board governance. We argue that firms can implement better board governance by drawing on local director talent when a larger pool of prospective directors (officers and directors of same-industry firms, financial institutions, and universities) is located near the firm. We find that firms located near la...