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Concepts of Board Performance: Review of Performance Metrics in Boards Research

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  • Miika Kuoppamaki

Abstract

This paper discusses concepts of board performance. Long traditions exist for using corporate financial metrics as indicators of board performance. I argue that a financial perspective alone is insufficient and sometimes misleading, and thus suggest addition of alternative measurement concepts. Arguments are based on analysis of extant research on boards and board directors. The concepts proposed in this paper are building on strategic review of board research articles in main international academic journals. I conclude from the research that board performance should be measured based on how boards are contributing to value creation. It was illustrated though the review that value creation takes place in intermediate steps and that board performance should be measure accordingly.

Suggested Citation

  • Miika Kuoppamaki, 2018. "Concepts of Board Performance: Review of Performance Metrics in Boards Research," Journal of Management and Strategy, Journal of Management and Strategy, Sciedu Press, vol. 9(3), pages 41-53, August.
  • Handle: RePEc:jfr:jms111:v:9:y:2018:i:3:p:41-53
    DOI: 10.5430/jms.v9n3p41
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    References listed on IDEAS

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    1. Annie Pye, 2002. "The Changing Power of ‘Explanations’: Directors, Academics and Their Sensemaking from 1989 to 2000," Journal of Management Studies, Wiley Blackwell, vol. 39(7), pages 907-925, November.
    2. Ruth V. Aguilera & Igor Filatotchev & Howard Gospel & Gregory Jackson, 2008. "An Organizational Approach to Comparative Corporate Governance: Costs, Contingencies, and Complementarities," Organization Science, INFORMS, vol. 19(3), pages 475-492, June.
    3. Wilson Ng & Christian De Cock, 2002. "Battle in the Boardroom: A Discursive Perspective," Journal of Management Studies, Wiley Blackwell, vol. 39(1), pages 23-49, January.
    4. Jonas Gabrielsson & Morten Huse, 2004. "Context, Behavior, and Evolution: Challenges in Research on Boards and Governance," International Studies of Management & Organization, Taylor & Francis Journals, vol. 34(2), pages 11-36, January.
    5. John A. Pearce & Shaker A. Zahra, 1991. "The relative power of ceos and boards of directors: Associations with corporate performance," Strategic Management Journal, Wiley Blackwell, vol. 12(2), pages 135-153, February.
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