Board interlocking network and the design of executive compensation packages

The standard approach used to model interlocks in the business and management literature is to treat each interlock of a network as an independent data point. However, such an approach ignores the complex inter-dependencies among the common director interlocks. We propose that an interlocking board network is an important inter-corporate setting that has bearing on how company boards make corporate decisions. Using a sample of 725 large U.S.-based public companies over the period 2007–2010, board member information, executive compensation information, and exponential random graph modeling (ERGM) techniques for social networks, we present evidence that board interlocks are positively linked with similarities in the design of executive compensation packages in interlocked firms, particularly the proportions of the options component. We also find evidence that board interlocks are positively linked with similarities in a number of board characteristics.     

What Nonprofit Executives Want and What They Get from Board Members

In theory, nonprofit boards of directors exist to perform mission‐setting and oversight functions that help to ensure organizational accountability. Yet there is evidence that board behavior often falls short of this ideal. Using survey data from a sample of 241 executive directors of nonprofit agencies, we investigated whether nonprofit boards are meeting executive directors’ expectations, and if not, what factors explain this? We find that although board behavior tends to align closely with executive directors’ preferences for involvement in administration and management tasks, there is a greater disconnect between board behavior and executive directors’ preferences for involvement in mission‐setting and oversight duties. Factors that mitigate this gap include organizational professionalization and stability, whereas more extensive reliance on government funding exacerbates it. Female executive directors experience a greater disconnect in their preferences for board involvement and actual board involvement than male executive directors. We conclude by discussing the implications of our findings for both theory and practice.     

Resignation or Dismissal?: When a CEO and a President Clash

In the executive director's opinion, Bluehills Family Services' board of directors had serious problems with their organizational governance. These difficulties came to a head in an apparently unresolvable clash between the executive director and the board president. Given the preexisting board and organization perceptions, could an emergency board meeting produce a positive outcome, and would the executive director's participation be counterproductive?     

Cooperative power relations between nonprofit board chairs and executive directors

Nonprofit organizations face increasing pressure to change their governance practices. Some scholars propose a check‐and‐balance relationship between the board chair and the executive director. However, empirical evidence for this proposition remains lacking. Employing actor‐centered institutionalism, this comparative case study analyzes the preferences and capabilities of the board chair and the executive director given environmental and organizational pressure. The article compares the results of two main and two replicated cases that underwent significant processes of governance change, which led to a replacement of the board chair and the executive director. After the replacement we observe in all cases a similar pattern in the governance power relation: This power relation is characterized by the actors' equivalent capabilities and complementary preferences. The article concludes by introducing a cooperative power relation model that specifies the concept of checks and balances between the board chair and the executive director.     

Building buy-in: The need for internal relationships and informal coalitions

Significant research has focused on influencing senior leadership, and this study offers new insights into building internal relationships and informal coalitions to provide strategic counsel. These strategies involve internal communications, a neglected area of research and practice. The findings are based on in-depth interviews with 30 executives representing multiple departments in four U.S. companies. A new role justifying public relations’ membership in executive decision teams is internal boundary spanning or gathering intelligence internally across business units, and requires public relations to have a seat at multiple decision tables.     

Commitment and performance of nonprofit board members

Boards of nonprofit organizations are entrusted to oversee and ensure that the organization remains true to its mission, functions within the confines of state and federal laws, and operates in a financially responsible manner. This critically important oversight is carried out by volunteers. This study examined the relationships between board member commitment and individual performance. Commitment was assessed using Meyer and Allen's Three‐Component Model of Commitment: Affective, Continuance, and Normative (1991). The population in this study was volunteer board members of midsized, social service nonprofit organizations in the Orange County, California, area. The strongest findings were between affective commitment and performance in board roles. Committed board members reported more involvement and are perceived by the executive to be more engaged and valuable. Analysis revealed that executive judgments of participation are based on both board member behavior and Affective commitment expressed by the board member.     

How did the financial crisis affect the transnationality of the global financial elite? One step forward and one step back

Over the last few decades, transnational elite formation progressed hand in hand with a deterioration in national business elites. Most studies regard this process as progressive and linear. However, we argue that transnational elite formation is subject to a variety of opposing forces, and the assumed progression is not a given fact. As an intriguing case, we analyse the financial business elite with a focus on the financial crisis of 2008. This international event had substantial ramifications, including a possible external shock to transnational elite formation. To study the consequences of the crisis, we collected the board composition data of the 48 largest transnational financial companies for the period 2006–11. Changes in board composition show opposing effects. For example, transnationality increased during the crisis, but reversals appeared when national governments intervened.     

Devolution of Services to Children and Families: The Experience of NPOs in Nanaimo,British Columbia,Canada

This study focuses on the current experience of Nanaimos nonprofit family and child service organizations (N = 29) providing services on behalf of government and their adaptation to this devolution. The effects and consequences of contracting on organizational practices, accountability, and services were explored through interviews and focus groups with executive directors, board members, line staff, government representatives, and the United Way. Results show that a significant proportion of funding comes from provincial government contracts. The funding climate is uncertain, and there is considerable confusion, stress, and time involved with the contracting process. Accountability requirements are demanding and nonprofit organizations (NPOs) express concern about a shift to a business management model. Recommendations include a need for increased collaboration between NPOs, a body that speaks for the voluntary sector, and improved relationships between NPOs and government funders.     

Scarce as hen's teeth: Women CEOs in large nonprofit organizations

This study examines an underlying mechanism behind the gender gap in nonprofit executive leadership, focusing on the link between the representation of women on governing boards and the hiring of female CEOs. The analysis of 340 human services organizations with gross receipts greater than $10 million in GuideStar's database reveals that organizations where women make up between one third and half of the board are more likely to have a female CEO compared to organizations where women account for less than one third or a majority of the board. The findings suggest that nonprofit organizations are more likely to hire a female CEO when women constitute a “substantial minority” of the governing board.     

Female participation in association governance and political representation: Women as executive directors,board members,lobbyists, and political action committee directors

This analysis of more than eleven hundred business, trade, and professional nonprofit associations identifies several internal organizational barriers to leadership for women. In addition, the analysis highlights the importance of female representation in governance positions, such as executive directors and board members, and of the selection of women as the political representatives of associations in roles such as lobbyists and political action committee directors.     

Topmanager im Spiegel ihrer Selbstorientierung

A whole collection of technical and popular scientific literature describes business thinking and communication processes. But what do we know about the thinking and communication processes of those that actually give important impulses in their leadership positions as members of the board and top managers? What do we know about their strategies and mechanisms? What is their underlying self and world view? This article gives answers to these questions in form of certain types and structures. The raw data was obtained as set of narrative, biographically oriented interviews, conducted with eight top managers. They have leading positions in companies with upwards of EUR 70 billion annual sales volume, and more than 300 000 employees. Most of the managers interviewed are members of the board. All companies considered are based in Germany.     

Notes on contributors

This article focuses on the organizational practices of the music industry to contribute a neglected dimension to our understanding of rap as a commercial activity and cultural form. It initially situates the production of rap within the context of the corporate strategies and business practices of musical entertainment companies, stressing how rap production is located within the context of corporate ‘black music divisions’ and the major labels' relationships to smaller companies. At the same time, the study considers how musical production is shaped by broader culture processes and practices that are not directly within the control or understanding of the company. As corporate organization intersects with and attempts to make sense of surrounding culture, I argue that the actions of recording companies are a direct intervention into and contribution to the way in which the social world is rationalized and fragmented and through which different cultural experiences are separated and treated unequally. This argument is focused on the theme of ‘the street’ and ‘executive suite’ through which I suggest that, while it is important to acknowledge the struggles of rap artists and entrepreneurs for both recognition and independence from the corporate world, it is also important to highlight deliberate attempts to maintain a distance between the corporate world and the genre culture of rap. This article seeks to contribute to our understanding of the articulations between musical genre, occupational practices and broader cultural formations, highlighting a significant series of connections and relational practices which connect production and consumption and the articulations through which corporate organization is linked to broader cultural formations.     

Contracting and Patterns of Nonprofit Governance

Executive staff and board members in nonprofit organizations that operate with government grants and contracts often work together to perform important governance functions. This shared responsibility can be predicted by strong executive leadership of the board, a board with highly regarded members, and affiliation with an influential statewide or regional association. The results of our research suggest that the distribution of governance responsibility in nonprofit organizations with government revenues should command the attention of researchers and activists.     

Private lives,public accountability: A case study

Lend a Hand Children's Services is the most prominent provider of family services in rural south central Ohio. The agency is in the process of enlarging its fundraising goals and becoming even bigger in the community. Staff have brought to the attention of the vice president of the board that the board president and the executive director may be involved intimately as a couple. Inasmuch as the board president must evaluate the executive director, the vice president turns to trusted counsel for advice on how to approach the unique problems raised by the situation.     

Board performance and organizational effectiveness in nonprofit social services organizations

This article examines the tasks and responsibilities of nonprofit boards of directors and explores the relationship between board performance and organizational effectiveness. Thirty-three activities in nine areas of board responsibility were examined through questionnaires and interviews with board members and chief executive officers of sixteen nonprofit organizations serving developmentally disabled adults. Rankings of organizational effectiveness were determined using external evaluators and accreditation surveys. A significant relationship between board performance and organizational effectiveness was found, and the board activities most strongly correlated with organizational effectiveness are reported, including policy formation, strategic planning, program monitoring, financial planning and control, resource development, board development, and dispute resolution.     

Evidence of a transnational capitalist class‐for‐itself: the determinants of PAC activity among foreign firms in the Global Fortune 500, 2000–2006

Transnational capitalist class (TCC) theory is rooted in the claim that the globalization of the economy has led to a globalization of economic interests and of class formation. However, systematic evidence linking the indicators of transnational class formation with political behaviour is largely missing. In this article, I combine data on board of director interlocks among the 500 largest business firms in the world between 2000 and 2006 with data on the political donations to US elections of foreign corporations via the corporate political action committees (PACs) of their subsidiaries, divisions or affiliates. Controlling for the various interests of individual firms, I find that foreign firms that are highly central in the transnational intercorporate network contribute more money to US elections than do the less central foreign firms. Given prior research on board of director interlocks, this finding suggests that a segment of the transnational business community has emerged as a class‐for‐itself.     

Effective boards: how executive directors define and develop them

There is growing recognition in the nonprofit field that the executive director has a key role in determining whether the board of directors will function effectively. To aid executives in this vital role, two recent studies defined a "good board" from the point of view of two samples of executive directors of community agencies, then sought factors related to board performance as measured by this definition. In interviews, executives whose boards scored higher than their peers on this performance measurement related how they work with their boards in such areas as recruitment of new members, financial management, fundraising, and leadership development.     

Designing Agendas to Reflect Board Roles and Responsibilities: Results of a Study

Over a nine‐month period the board agendas of a community nonprofit organization were redesigned to reflect a particular board agenda tool titled “Strategic Activities, Resource Planning, and Operations.” Feedback from the board members and executive director indicate strong support for the framework in focusing the work of the board. The framework also has implications for how the executive director and board members prepare for meetings and how the shared leadership of the meetings is played out.     

Nonprofit association CEOs how their context shapes what,how, and why they learn

This qualitative study explored the learning experiences of twelve national nonprofit membership association CEOs using a phenomenological research design. While the professional context of an organization's chief executive is considered unique from other executive positions, the impact of this context on what and how CEOs learned was unclear. The findings describe association CEO learning as being affected in significant ways by the politically charged context in which the nonprofit association CEO operates with his or her board of directors. Power imbalances with staff and the board make learning through traditional organizational dialogue a less useful learning process for the CEOs. Furthermore, the feelings of isolation and vulnerability that are generated from the nonprofit association CEO context often cause CEOs to use private reflection and dialogue with their spouse as primary learning mechanisms. The study concludes that the association CEO context uniquely and profoundly shapes what, how, and why CEOs learn. Perhaps lacking the financial security of lucrative severance payments, which are often specified in employment contracts of for‐profit CEOs, the nonprofit association CEO will often temper his or her actions to avoid personal vulnerability with a politically charged board of directors.     

Revisiting Agency and Stewardship Theories

Using principal–agent theories, this study examined differences in the perceptions of nonprofit chief executive officers (CEOs) and board chairs on key governance aspects, including board performance, leadership, satisfaction with diversity, and board meetings. Using data from the CEOs and board chairs of 474 nonprofit organizations, we found statistically significant differences in the governance perceptions of these leaders of nonprofit organizations. The findings provide support for an agency theory explanation about the differing interests of principals (board chairs) and agents (CEOs). The findings suggest that these two sets of nonprofit actors frequently operate from different perspectives, potentially affecting the governance of their organizations.