Effects of Firm Complexity on the Adaption of Board Structure: Evidence from U.S. Electric Utilities following Deregulation

Authors

Chun-Keung Hoi, Rochester Institute of Technology
Patricia L. Wollan, St. John Fisher UniversityFollow

Document Type

Conference Proceeding

Publication Date

4-2012

Abstract

This paper reexamines the adaptation of board structure in U.S. electric utilities following deregulation. Post-deregulation changes in board size and the number of outside directors are positively and statistically-significantly associated with changes in the complexity of a firm’s operations. Electric utilities that do not become more complex after deregulation reduce their board size significantly, employing fewer outside and inside directors. In contrast, board size is unchanged for firms that become more complex; these utilities employ more outsiders but fewer inside directors after deregulation. We conclude that electric utility boards adapt to deregulation by accommodating for changes in firm complexity in addition to other effects induced by deregulation.

Comments

Presented at the Business Research Consortium Conference of Western New York, in Oswego, New York, April 2012. This paper was also included in the conference proceedings: http://www.businessresearchconsortium.org/archives.cfm?template=9

Publication Information

Hoi, Chun-Keung and Wollan, Patricia L. (2012). "Effects of Firm Complexity on the Adaption of Board Structure: Evidence from U.S. Electric Utilities following Deregulation." 2012 BRC PROCEEDINGS , 353-380.

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