Corporate Governance and the Board of Directors: Performance Effects of Changes in Board Composition

  title={Corporate Governance and the Board of Directors: Performance Effects of Changes in Board Composition},
  author={B. D. Baysinger and H. Butler},
  journal={Journal of Law Economics & Organization},
  • B. D. Baysinger, H. Butler
  • Published 1985
  • Business
  • Journal of Law Economics & Organization
  • Recent advances in economic theory suggest that the board of directors is an important part of the governance structure of large business corporations (Fama and Jensen, 1983a; Williamson, 1983, 1984). The board of directors, which has the power to hire, fire, and compensate senior management teams, serves to resolve conflicts of interest among decisionmakers and residual risk bearers. This economizes the transaction (agency) costs associated with the separation (specialization) of ownership and… CONTINUE READING
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