IDEAS home Printed from https://ideas.repec.org/a/bla/jomstd/v37y2000i3p321-348.html
   My bibliography  Save this article

Boards of Directors and Shark Repellents:Assessing the Value of an Agency Theory Perspective

Author

Listed:
  • Steven A. Frankforter
  • Shawn L. Berman
  • Thomas M. Jones

Abstract

Because shark repellents decrease the vulnerability of firms (and their incumbent managers) to the market for corporate control, the decision to adopt these devices represents an excellent test of agency theory. In this empirical study, we examined the relationships between the adoption of shark repellents and several mechanisms that, according to agency theory, should align the interests of corporate board members and shareholders and/or make directors more effective monitors of management behaviour. Of the variables included, only board stock ownership (especially by employee directors) was linked to a reduced propensity to adopt shark repellents in the predicted manner. Two variables not immediately as‐ sociated with agency theory — the proportion of inside directors appointed by the incumbent chief executive officer (CEO) and a lower ratio of CEO compensation to the compensation of other top executives — were linked to higher rates of shark repellent adoption. Given that agency theory explains relatively little of the variance in shark repellent adoption, we advocate serious consideration of other theoretical formulations for corporate governance, including two approaches — stewardship theory and agent morality — that take the moral (‘other regarding’) obligations of directors seriously.

Suggested Citation

  • Steven A. Frankforter & Shawn L. Berman & Thomas M. Jones, 2000. "Boards of Directors and Shark Repellents:Assessing the Value of an Agency Theory Perspective," Journal of Management Studies, Wiley Blackwell, vol. 37(3), pages 321-348, May.
    • Handle: RePEc:bla:jomstd:v:37:y:2000:i:3:p:321-348
    DOI: 10.1111/1467-6486.00183
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/1467-6486.00183
    Download Restriction: no
    File URL: https://libkey.io/10.1111/1467-6486.00183?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tiago Melo & Alvaro Garrido‐Morgado, 2012. "Corporate Reputation: A Combination of Social Responsibility and Industry," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 19(1), pages 11-31, January.
    2. Pant, Abhay & Nidugala, Ganesh Kumar, 2022. "Board characteristics and efficiency of value added by banks: Evidence from an emerging economy," Journal of Asian Economics, Elsevier, vol. 79(C).
    3. Emmanuel Mamatzakis & Anna Bagntasarian, 2021. "The nexus between CEO incentives and analysts' earnings forecasts," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 6205-6248, October.
    4. Qaisar Iqbal & Noor Hazlina Ahmad & Yongmei Li, 2021. "Sustainable Leadership in Frontier Asia Region: Managerial Discretion and Environmental Innovation," Sustainability, MDPI, vol. 13(9), pages 1-14, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jomstd:v:37:y:2000:i:3:p:321-348. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0022-2380 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.