Boards of a Feather Flock Together: Board Networks Among ASX Firms

Abstract:     
The study uses a large sample of between 1,162 and 1,700 companies listed on the Australian Securities Exchange (ASX) each of the financial years 2000-07 to explore characteristics of director interlocking in Australia. It provides insight in to the applicability of various director interlocking theories, finding that resource dependence and homophily theory best explain the phenomenon in Australia. Large firms and those in the financial sector are the most interlocked. It is revealed that firms are more likely to share directors with another that shares industry, location, or size in common.

Number of Pages in PDF File: 40

Keywords: Director Interlocks, Corporate Governance, Australia, Homophily, Resource Dependence Theory

JEL Classification: G34, L22

working papers series