TY  - JOUR
AU  - Schwartz-Ziv,Miriam
AU  - Weisbach,Michael
TI  - What do Boards Really Do? Evidence from Minutes of Board Meetings
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 17509
PY  - 2011
Y2  - October 2011
UR  - http://www.nber.org/papers/w17509
L1  - http://www.nber.org/papers/w17509.pdf
N1  - Author contact info:
Miriam Schwartz-Ziv
Program on Corporate Governance
Harvard Law School
1557 Massachusetts Avenue
Cambridge, MA 02138
E-Mail: miriam.schwartz@mail.huji.ac.il

Michael Weisbach
Department of Finance
Fisher College of Business
Ohio State University
2100 Neil Ave.
Columbus, OH  43210
Tel: 614/292-3264
E-Mail: weisbach.2@osu.edu
M2  - featured in NBER digest on 2012-02-01
AB  - We analyze a unique database from a sample of real-world boardrooms – minutes of board meetings and board-committee meetings of eleven business companies for which the Israeli government holds a substantial equity interest. We use these data to evaluate the underlying assumptions and predictions of models of boards of directors. These models generally fall into two categories: “managerial models” assume boards play a direct role in managing the firm, and “supervisory models” assume that boards’ monitor top management but do not make business decisions themselves. Consistent with the supervisory models, our minutes-based data suggest that boards spend most of their time monitoring management: 67% of the issues they discussed were of a supervisory nature, they were presented with only a single option in 99% of the issues discussed, and they disagreed with the CEO only 3.3% of the time. In addition, managerial models describe boards at times as well: Boards requested to receive further information or an update for 8% of the issues discussed, and they took an initiative with respect to 8.1% of them. In 63% of the meetings, boards took at least one of these actions or did not vote in line with the CEO.
ER  -