Abstract

http://ssrn.com/abstract=1941790
 
 

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Nonprofit Boards: Size, Performance, and Managerial Incentives


Rajesh K. Aggarwal


Northeastern University

Mark E. Evans


Wake Forest University

Dhananjay Nanda


University of Miami - School of Business Administration

September 1, 2011

Journal of Accounting & Economics (JAE), Forthcoming

Abstract:     
We examine relations between board size, managerial incentives and enterprise performance in nonprofit organizations. We posit that a nonprofit's demand for directors increases in the number of programs it pursues, resulting in a positive association between program diversity and board size. Consequently, we predict that board size is inversely related to managerial pay-performance incentives and positively with overall organization performance. We find empirical evidence consistent with our hypotheses. The number of programs is positively related to board size. Board size is associated negatively with managerial incentives, positively with program spending and fundraising performance, and negatively with commercial revenue, in levels and changes.

Number of Pages in PDF File: 52

Keywords: Nonprofits, incentives, boards of directors

JEL Classification: D21, G34, J33, L31, M40

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Date posted: October 10, 2011  

Suggested Citation

Aggarwal, Rajesh K. and Evans, Mark E. and Nanda, Dhananjay, Nonprofit Boards: Size, Performance, and Managerial Incentives (September 1, 2011). Journal of Accounting & Economics (JAE), Forthcoming. Available at SSRN: http://ssrn.com/abstract=1941790

Contact Information

Rajesh K. Aggarwal
Northeastern University ( email )
413 Hayden Hall
360 Huntington Avenue
Boston, MA 02115
United States
Mark E. Evans (Contact Author)
Wake Forest University ( email )
P.O. Box 7659
Winston-Salem, NC 27109-7285
United States
Dhananjay Nanda
University of Miami - School of Business Administration ( email )
P.O. Box 248126
Florida
Coral Gables, FL 33124
United States
3052843122 (Phone)
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