The Board of Directors as a Social Network

Harris, Dawn; Helfat, Constance E.

doi:10.1177/1056492607305901

Cited by 43 publications

(26 citation statements)

References 38 publications

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“…Scholars have conceptualized directors' social capital as a means for obtaining valuable information (Carpenter and Westphal, 2001) as well as a means for managing the firm's dependence on external constituencies (Westphal and Milton, 2000). Scholars have also focused on social capital internal to firms or boards (Fischer and Pollock, 2004;Harris and Helfat, 2007) as well as on the interaction between CEO social capital and board-level social capital (Sundaramurthy et al, 2014). Johnson et al (2013: 246) summarized director social capital as "a conduit for the flow of resources, information, and advice both into and out of the organization.…”

Section: Hypothesis 1: a Board Chair's Human Capital Is Positively Asmentioning

confidence: 99%

That special someone: When the board views its chair as a resource

2015

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Research summary: Many boards view their chairs as valuable resources. We predict that whether a board adopts such a view depends on the board chair's human and social capital. Data from S&P 500 firms suggest that while a board chair's human capital increases the probability that the board views him or her as a resource, social capital has no overall effect. In a post‐hoc investigation, however, we find the board chair's independence to be an important boundary condition for the effect of social capital. With this exploratory research, we aim to spur research devoted specifically to board chairs. Such research will become increasingly important over time as firms continue to separate their CEO and board chair positions. Managerial summary: The purpose of this research was to determine the factors that lead a board of directors to view its chair as a valuable resource. We expected that board chairs with high human and social capital would be more likely to be viewed as a resource by their colleagues. Surprisingly, only human capital exhibited such an effect overall. Social capital increases the likelihood a chair is viewed as a resource when the chair is independent, but actually decreases the likelihood a chair is viewed as a resource when the chair is either the current or former CEO. These results suggest that boards generally value human capital in their chairs, but view social capital through a somewhat more complex lens. We explore the possible implications of these findings in the article. Copyright © 2015 John Wiley & Sons, Ltd.

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Section: Hypothesis 1: a Board Chair's Human Capital Is Positively Asmentioning

confidence: 99%

That special someone: When the board views its chair as a resource

2015

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“…Characteristics of independent directors and the propensity to pay dividends 2.3.1. Tenure of independent directors Social network theory posits that individuals develop and strengthen their friendship and social ties with each other through extended interpersonal interactions both in formal and informal group settings (Harris and Helfat, 2007). In a group setting such as the board of directors, independent directors develop and solidify their friendship or social ties with management as their tenure on the board increases.…”

Section: Prior Research and Hypotheses Developmentmentioning

confidence: 99%

Independent directors and the propensity to pay dividends

Sharma

2011

Journal of Corporate Finance

129

140

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“…Hillman and Dalziel (2003) proposed that board capital should promote firm performance, because of the resources it provides. Harris and Helfat (2007) went a step further and argued that the board constitutes an entire social network unto itself.…”

Section: Theory and Hypothesesmentioning

confidence: 99%

External COO/presidents as expert directors: A new look at the service role of boards

2013

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Much of the scholarship on boards of directors has examined either the control (i.e., monitoring) role or the resource dependence role that boards fill. Relatively little has examined the service role, wherein directors provide advice and guidance to management. This study builds on recent work exploring director expertise by asking how operational expertise on boards impacts firm performance. We find that having external COO/presidents on a board of directors positively impacts firm performance when the firm's operational efficiency is declining, but negatively impacts performance when the firm's operational efficiency is improving. We also find that other types of external executives serving as directors exhibit the opposite relationship, suggesting that the value of director expertise is context‐dependent. We discuss the implications of these findings for director selection. Copyright © 2013 John Wiley & Sons, Ltd.

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The Board of Directors as a Social Network

Cited by 43 publications

References 38 publications

That special someone: When the board views its chair as a resource

That special someone: When the board views its chair as a resource

Independent directors and the propensity to pay dividends

External COO/presidents as expert directors: A new look at the service role of boards

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