Research into boards of directors has provided mixed support for the view that outside directors' independence or leadership by an independent chair improves monitoring. In this study, we use a micro-level approach to provide a better understanding of why outside directors have difficulty in monitoring the CEO. We highlight that an important reason for this lies in the boardroom dynamics associated with (a) outside directors' cognitive conflict with the CEO and (b) the chair's leadership of the board. Our inductive analyses of video observations of board meetings in five Australian corporations revealed the importance of chair participative leadership during disagreement episodes in the boardroom. Follow-up in-depth interviews of board meeting participants highlighted the importance of psychological safety as a key mechanism explaining why participative board chairs appear so effective in dealing with board-CEO cognitive conflict. We corroborate these results with a second, large-scale survey study involving data on 310 outside directors from 64 Dutch boards. Whereas prior work has mostly focused on the chair's relationship with the CEO, we instead highlight the importance of the chair's role as the leader of the board and identify board psychological safety as an important element shaping director monitoring within the confines of the boardroom.We sincerely thank the editor, Brian Connelly, and three anonymous reviewers whose supportive and insightful suggestions helped us to develop our work. We also thank Michael Withers, Christine Shropshire, Craig Crossland, Steven Boivie, Sten Langmann, Gerben van der Vegt, and Floor Rink for their advice on earlier drafts of this article, and Larry Williams and Bob Vandenberg for their advice on our analyses. We thank audiences at

Drawing from corporate governance research and social identity theory, the authors argue that the relationship between outside directors' time in office and outside director task involvement is more complex than generally anticipated. By using a unique multisource data set composed of peer ratings provided by fellow outside directors rating a focal director's task involvement, this study analyzes director task involvement at the individual director level of analysis. The authors propose and empirically demonstrate that outside director tenure has an inverted U-shaped relationship with outside director task involvement that is moderated by a director's social identification with the organization. As such, the authors demonstrate that social identification with the organization provides a critical contingency for the curvilinear relationship between outside director tenure and outside director task involvement. Findings suggest that outside directors who socially identify with the organization are more likely to grow "stale in the saddle" at lower levels of tenure. These findings provide support for the merit of analyzing outside directors at the individual level of analysis and suggest that a "one-size-fits-all" approach may not be most appropriate in assessing the effects of tenure on outside director functioning. Acknowledgments: We are grateful to Associate Editor Sucheta Nadkarni and two anonymous JOM reviewers for their guidance on this article. Also, we thank Frank Walter, Bernard Nijstad, Jakob de Haan, and Jaap van Manen for their friendly reviews and useful insights. In addition, we are grateful to VTW in general and Albert Kerssies in particular for helpful guidance during the setup phase of this research project. The views expressed do not necessarily reflect the position of De Nederlandsche Bank.

Manuscript Type: EmpiricalResearch Question/Issue: The authors posit that to understand the effects of board demographic diversity on board performance, it is critical to recognize that board members often do not come to a board as independent entities but rather as delegates of specific interest groups so that the board has factions. The authors propose that demographic differences between these factions are likely to negatively affect board performance through social categorization processes. Research Findings/Insight: A study of 318 Dutch pension fund boards shows that factional demographic faultlines negatively affect board performance, measured as perceived board effectiveness, and financial return on investment, through the perception of board members that the board is split into factional subgroups (i.e., faultline activation). At the same time, the disruptive effects from factional demographic faultlines are found to be reduced by board reflexivity. Theoretical/Academic Implications: Based on social categorization theory, this study shows that demographic faultlines between factions affect board performance to the extent that the faultlines are activated. If unnoticed by board members, demographic faultlines are unlikely to influence board behavior. The attenuating effect of board reflexivity underlines the importance of insight into the factors that drive social categorization within boards. Practitioner/Policy Implications: Practitioners should be aware that although factional demographic faultlines can be disruptive, there are ways to reduce these negative aspects. By overtly reflecting on board processes, board members can prevent factional demographic faultlines from resulting in social categorization within boards.