Appointments of Academic Directors

47 Pages Posted: 11 Feb 2013 Last revised: 15 Dec 2013

See all articles by Joshua T. White

Joshua T. White

Vanderbilt University - Finance

Tracie Woidtke

University of Tennessee, Haslam College of Business

Harold A. Black

University of Tennessee, Knoxville - Department of Finance

Robert L. Schweitzer

University of Delaware

Date Written: November 24, 2013

Abstract

We examine the outside director selection process using unique data on appointments of academic directors. Overall, we find academic directors tend to be appointed by small- and mid-cap firms expanding their boards. However, we find important differences in both the factors influencing academic appointments and the market’s reaction when allowing for firm, board, and director heterogeneity. Academics in science, medicine and engineering appear to be appointed for their expertise, and the market reacts favorably. Academic administrators appear to be appointed for their networks, and the market reacts favorably when the administrator is affiliated with a business school but negatively when the administrator is not within close geographic proximity. Business professors appear to be appointed for general expertise and reputation, but we find little evidence of any significant market reaction. The results in this paper highlight the importance of recognizing heterogeneity in understanding the director selection process and the role of outside directors.

Keywords: Corporate boards; Director selection; Academic directors; Director characteristics; Heterogeneity

JEL Classification: G3, G30, G34

Suggested Citation

White, Joshua T. and Woidtke, Tracie and Black, Harold A. and Schweitzer, Robert L., Appointments of Academic Directors (November 24, 2013). Journal of Corporate Finance, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2214365 or http://dx.doi.org/10.2139/ssrn.2214365

Joshua T. White (Contact Author)

Vanderbilt University - Finance ( email )

401 21st Avenue South
Nashville, TN 37203
United States

Tracie Woidtke

University of Tennessee, Haslam College of Business ( email )

428 Stokely Management Center
Knoxville, TN Tennessee 37996-0540
United States
865-974-1718 (Phone)
865-974-1716 (Fax)

Harold A. Black

University of Tennessee, Knoxville - Department of Finance ( email )

Knoxville, TN 37996
United States
423-974-1721 (Phone)
423-974-1716 (Fax)

Robert L. Schweitzer

University of Delaware ( email )

Newark, DE 19716
United States

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