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Squared Away: Veterans on the Board of Directors

Author

Listed:
  • Joseph Simpson

    (The University of Texas Rio Grande Valley)

  • Ana Marcie Sariol

    (University of South Dakota)

Abstract

Given the vital importance of the board of directors, firms seek to staff their boards with competent individuals who bring valuable skills and expertise to assist a firm. Especially following crises, firms should be interested in appointing directors who possess not only superior decision-making skills under pressure, but who also may be inclined to behave more ethically to prevent future breaches of stakeholder trust. Applying a social identity perspective, we argue that directors with U.S. military experience are decidedly valuable to firms because of their human capital. Using a sample of 144 U.S. based, publicly-traded firms that experienced a Securities Class Action Lawsuit between 2002 and 2012, we test hypotheses predicting that following crises, firms are more likely to appoint directors with military experience. Our findings extend the social identity view of an individual from the self or how individuals view themselves to include how others may view them.

Suggested Citation

  • Joseph Simpson & Ana Marcie Sariol, 2019. "Squared Away: Veterans on the Board of Directors," Journal of Business Ethics, Springer, vol. 160(4), pages 1035-1045, December.
    • Handle: RePEc:kap:jbuset:v:160:y:2019:i:4:d:10.1007_s10551-018-3907-1
    DOI: 10.1007/s10551-018-3907-1
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    Cited by:

    1. Etienne Redor & Magnus Blomkvist, 2022. "Are former military personnel valuable to shareholders? Evidence from boards of directors," Economics Bulletin, AccessEcon, vol. 42(3), pages 1314-1330.
    2. Dayuan Li & Chen Huang & Ding Wang, 2023. "How Chief Executive Officers’ first-hand experience of the Great Chinese Famine affects risk-taking?," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-11, December.
    3. Liu, Xianda & Hou, Wenxuan & Main, Brian G.M., 2024. "Military experience and subsequent effectiveness as a director," Journal of Economic Behavior & Organization, Elsevier, vol. 222(C), pages 144-176.
    4. Cai, Chen & Hasan, Iftekhar & Shen, Yinjie & Wang, Shuai, 2021. "Military directors, governance and firm behavior," Advances in accounting, Elsevier, vol. 55(C).
    5. Anutchanat Jaroenjitrkam & Sakkakom Maneenop & Sirimon Treepongkaruna, 2024. "Corporate governance, policies, and outcomes: The appointment of military connected boards and sustainability," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(1), pages 448-471, January.

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