2 essays on the norm preservation view of corporate elites

Abstract

Extant research on independent director careers argues that CEOs favor independent directors with social ties to them. This study departs from the corporate elite view of board studies, which assumes that all social relationships between the CEO and director will be mutually beneficial. Instead, this study addresses a critical construct coined as “norm preservation”, which suggests that the norm of social experiences between individuals preserve over time. The preserved norms may conform or conflict with the current norm of the CEO. I examine how norm preservation between the CEO and director influences independent director tenure. In particular, I study how the preserved norm between the CEO and the board further influences firm strategy and performance.