Decision Sciences Journal
Volume 30, Number 1
Winter 1999
On the Measurements of Board Composition: Poor Consistency
and a Serious Mismatch of Theory and Operationalization
Catherine M. Daily
Kelley School of Business, Indiana University, Bloomington, IN
47405-1701, email: cdaily@indiana.edu
Jonathan L. Johnson
School of Business Administration, University of Arkansas, Fayetteville,
AR 72701, email: jonjohn@comp.uark.edu
Dan R. Dalton
Kelley School of Business, Indiana University, Bloomington, IN
47405-1701, email: dalton@indiana.edu
ABSTRACT. Over two dozen operationalizations of board
composition can be identified from the empirical literature.
A structural equations confirmatory factor analysis (LISREL 8.03)
suggests that these operationalizations do not constitute a single
construct of board independence. Instead, analyses strongly indicate
three separate constructs. Common operationalizations of board
composition, then, are neither tenable surrogates for one another
nor are they interchangeable. Implications for empirical aggregation
of studies, theory/measurement convergence, and the current corporate
governance public policy debate are discussed.
Subject Areas: Board Composition, Board Independence,
Confirmatory Factor Analysis, Strategic Decision Making, and
Structural Equation Modeling. |