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While corporate governance research has had some success tying boards' demographic characteristics to relatively distant outcomes such as CEO pay and succession, numerous studies have indicated that a major weakness of this research is that it has largely ignored the intervening behaviours associated with board vigilance. This study begins to answer this call by examining the relationship between boards' demographic characteristics and boards' information-gathering behaviour. Using primary and secondary data from 149 firms, this study finds that an increase in the proportion of outside directors on a board is associated with an increase in boards' information quality and proactive information-seeking. In addition, an increase in outside director tenure is associated with boards exchanging information more frequently. Consistent with agency theory predictions, these findings suggest that vigilant boards are likely to take actions aimed at reducing the level of information asymmetry between them and their CEOs. Copyright (c) 2007 The Authors; Journal compilation (c) 2007 Blackwell Publishing Ltd.

Agency theory focuses on monitoring and incentives as two solutions to agency problems. Prior research suggests that monitoring and incentives may act either as substitutes or as complements, and that the context of the agency relationship plays a major role in determining the direction of the relationship between them. In a corporate governance setting, we contend that board information and boards' usage of CEO control mechanisms are best viewed as complements. Thus, we hypothesize that boards' information gathering behaviour will be positively related to boards' usage of CEO control mechanisms. Using primary and secondary data from 149 US firms, we find that increases in boards' information gathering are associated with increases in boards' usage of managerial controls. These findings suggest that information and managerial control mechanisms act as complements in the governance context, and that boards take a variety of actions to protect the interests of shareholders. Copyright Blackwell Publishing Ltd 2007.

Because prior research has largely adopted an agency theory perspective and focused extensive effort on examining shareholder-centric corporate governance mechanisms and their outcomes for shareholders or select groups of stakeholders, relatively little work has focused on whether governance structures can maximize outcomes for all stakeholders. We adopt an integrated, stakeholder-agency theory perspective to explore a set of corporate governance mechanisms that potentially can help firms generate greater engagement with a broad array of stakeholders. We test the relationship between stakeholder-centric governance and corporate social performance using a sample of 342 firms in 24 countries over four years and find that certain corporate governance mechanisms can indeed be construed as 'stakeholder-centric' as they positively impact corporate social performance.