Hierarchal Boards

The board of directors is a flat governance structure where each director has an equal vote in determining the collective actions taken by the group. Yet, some boards choose to delegate authority for specific tasks to committees, creating a hierarchal board. In contrast, other firms choose to create few, if any, committees of the board and maintain a relatively flat board structure. The authors explore the determinants of hierarchal board structures and argue that firms use committees to mitigate the co-ordination, communication, and free-riding problems that can occur with larger, more independent boards.

Provided by: University of Alaska Topic: Software Date Added: Sep 2007 Format: PDF

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