Business Commons^™

Commanding Board Of Director Attention: Investigating How Organizational Performance And Ceo Duality Affect Board Members' Attention To Monitoring, Chris S. Tuggle, David G. Sirmon, Chris R. Reutzel, Leonard Bierman

Department of Management: Faculty Publications

Boards of directors’ attention to monitoring represents an understudied topic in corporate governance. By analyzing hundreds of board meeting transcripts, we find that board members do not maintain constant levels of attention toward monitoring, but instead selectively allocate attention to their monitoring function. Drawing from the attention-based view, prospect theory, and the literature on power, we find that deviation from prior performance and CEO duality affect this allocation. Specifically, while negative deviation from prior performance increases boards’ attention to monitoring, positive deviation from prior performance reduces it. The presence of duality also reduces the boards’ allocation of attention to monitoring. …