Too Busy to Show Up? An Analysis of Directors' Absences
34 Pages Posted: 25 Aug 2008 Last revised: 7 Sep 2008
Date Written: January 21, 2008
This study contributes to the debate on the benefits and costs of multiple directorships by investigating the impact of multiple directorships on board meeting attendance. Individuals with multiple board seats (or "busy" directors) exhibit a higher tendency to be absent from board meetings. The results are robust even after controlling for firm-specific characteristics, board-of-directors structure and endogeneity. Furthermore, our results do not support the hypothesis that directors with higher ownership stakes are more motivated to attend board meetings. Monetary inducements such as board meeting fees and annual director retainers do not appear to enhance attendance. Finally, the enactment of the Sarbanes-Oxley Act appears to have a material impact on board attendance.
Keywords: multiple directorships, meeting attendance, corporate governance, busy directors
JEL Classification: G32, G34, G38
Suggested Citation: Suggested Citation