Publication Type

Journal Article

Publication Date

10-2013

Abstract

This study explores how CEOs' and outside directors' desires for the benefits of signaling and homophily intertwine with their concerns over maintaining power and preserving local status hierarchies to affect the likelihood a firm recruits prestigious outside directors to its board. Using pooled cross-sectional data on the five years following the IPOs of 210 firms that went public between 2001 and 2004, we found that prestigious CEOs and directors viewed the recruitment of prestigious new directors differently, and that these perceptions were moderated by factors that increase the salience of risk of the potential losses to the CEO and existing board members.

Keywords

board of directors, homophily, IPO, power, signaling, status

Discipline

Business | Strategic Management Policy

Research Areas

Strategy and Organisation

Publication

Academy of Management Journal

Volume

56

Issue

5

First Page

1396

Last Page

1419

ISSN

0001-4273

Identifier

10.5465/amj.2011.0639

Publisher

Academy of Management

Additional URL

http://dx.doi.org/10.5465/amj.2011.0639

Share

COinS