Directors are not one-dimensional. We characterize their skill sets by exploiting Regulation S-K’s 2009 requirement that U.S. firms must disclose the experience, qualifications, attributes, or skills that led the nominating committee to choose an individual as a director. We then examine how skills cluster on and across boards. Factor analysis indicates that the main dimension along which boards vary is in the diversity of skills of their directors. We find that firm performance increases when director skill sets exhibit more commonality.
Best Paper Award in Corporate Finance in the 2014 FMA Asia Meetings.
Shortlisted for the Best Paper Award in Corporate Finance in the 2015 FMA Meetings.
Blog post about the paper at the Harvard Law School Forum on Corporate Governance and Financial Regulation.