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Board Evaluations and Boardroom Dynamics

9 Pages Posted: 4 Mar 2017 Last revised: 18 Mar 2017

Taylor Griffin

The Miles Group

David F. Larcker

Stanford University - Graduate School of Business

Stephen A. Miles

The Miles Group (TMG)

Brian Tayan

Stanford University - Graduate School of Business

Date Written: March 6, 2017

Abstract

The boards of all publicly traded companies are required to conduct a self-evaluation at least annually to determine whether they are functioning effectively. Research suggests that while many directors are satisfied with the job that they and their fellow board members do, board evaluations and boardroom performance fall short along several important dimensions. We review the current state of board evaluations, and summarize how they can improve.

We ask:

• Why do board evaluations fail to review the performance of individual directors?
• What are the social and psychological barriers to conducting effective evaluations, and how can they be reduced?
• What behaviors are required to be successful in a boardroom setting?
• How important is boardroom culture, and how does it influence decision making?

The Closer Look series is a collection of short case studies through which we explore topics, issues, and controversies in corporate governance and executive leadership. In each study, we take a targeted look at a specific issue that is relevant to the current debate on governance and explain why it is so important. Larcker and Tayan are co-authors of the books Corporate Governance Matters and A Real Look at Real World Corporate Governance.

Keywords: Board of directors, board evaluations, boardroom dynamics, board performance, board culture, coaching, succession planning, leadership, corporate governance research

JEL Classification: G3, G30, M10

Suggested Citation

Griffin, Taylor and Larcker, David F. and Miles, Stephen A. and Tayan, Brian, Board Evaluations and Boardroom Dynamics (March 6, 2017). Rock Center for Corporate Governance at Stanford University Closer Look Series: Topics, Issues and Controversies in Corporate Governance No. CGRP63 ; Stanford University Graduate School of Business Research Paper No. 17-22. Available at SSRN: https://ssrn.com/abstract=2927273

Taylor Griffin

The Miles Group ( email )

630 Fifth Avenue Suite 3210
New York, NY 10111

David F. Larcker (Contact Author)

Stanford University - Graduate School of Business ( email )

Graduate School of Business
518 Memorial Way
Stanford, CA 94305-5015
United States
650-725-6159 (Phone)

Stephen A. Miles

The Miles Group (TMG) ( email )

630 Fifth Avenue Suite 3210
New York, NY 10111

HOME PAGE: http://miles-group.com/

Brian Tayan

Stanford University - Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

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