Law Commons^™

The Puzzle Of Independent Directors: New Learning, Frederick Tung

Faculty Scholarship

In this symposium paper, I discuss and critique some new empirical learning on independent directors.

The independent director has always offered a sort of magic bullet for corporate governance, representing the idealized monitor of executives’ behavior. Yet we corporate law scholars also harbor some ambivalence about the magic of this bullet. As much as we want to trust in the promise of independent directors, no solid empirical evidence exists to suggest that independent directors add value. Moreover, we have seen spectacular failures in the face of independent boards.

How do we account for this disconnect between our intuitions and best …