Ranking Boards of Directors

29 Pages Posted: 15 Jan 2008

See all articles by Martin J. Conyon

Martin J. Conyon

Bentley University; Wharton School, Center for Human Resources

Mark R. Muldoon

University of Manchester - Department of Mathematics

Date Written: January 2008

Abstract

We propose ranking the importance (centrality) of boards of directors using a variant of the PageRank algorithm from computational graph theory. PageRank is at the heart of the immensely successful Google web search engine and, we argue, can be naturally extended to social network settings. Using tools from graph theory, we represent the board of directors as an undirected bipartite graph. Since PageRank operates on directed graphs we develop a procedure to pass from an undirected bipartite graph to appropriately weighted, directed projections. Finally, to illustrate the procedure we present preliminary rankings of publicly traded US and UK firms using this method. Our procedure provides a quick and efficient way to rank the importance of corporate boards.

Keywords: Social Networks, Boards of Directors

JEL Classification: G34, M41

Suggested Citation

Conyon, Martin J. and Muldoon, Mark R., Ranking Boards of Directors (January 2008). Available at SSRN: https://ssrn.com/abstract=1083924 or http://dx.doi.org/10.2139/ssrn.1083924

Martin J. Conyon (Contact Author)

Bentley University ( email )

175 Forest Street
Waltham, MA 02145
United States

Wharton School, Center for Human Resources ( email )

3600 Locust Walk
Philadelphia, PA 19104-6365
United States

Mark R. Muldoon

University of Manchester - Department of Mathematics ( email )

Oxford Road
Manchester M13 9PL, M13 9PL
United Kingdom

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