Corporate directors' implicit theories of the roles and duties of boards

Research summary The question of what boards do, or should do, has remained a central focus in governance research. Much of this research is based on explicit theories or empirical models that impose assumed behaviors onto boards—such as monitoring—that are thought to define their roles and duties. While these explicit perspectives have offered critical insights, we suggest it is time to consider directors' implicit beliefs of their roles and duties to understand their perspective of the board's overall role. We use a grounded theory approach to develop theoretical insights about directors' implicit views of their roles and duties. We integrate information learned from extensive interviews with active directors and executives and find that directors view themselves as strategic partners with their firms' executives. Managerial summary How do directors view their work on their boards? This remains a critical question for corporate governance researchers and practitioners alike. To help answer this question, we conducted extensive interviews with current directors and executives. Our analysis of these interviews suggests that directors view their CEOs as generally acting in the best interests of their firms. In turn, directors consider strategically collaborating with their CEOs as critical to their board service. Recognizing the unique perspectives that directors bring to the boardroom has important implications for governance practices directed toward ensuring overall board effectiveness.