Not the usual suspects: How to use board process to make boards better

Research on corporate boards and board reform efforts alike have been dominated by a concern for board independence and its effect on the monitoring of the CEO. However, attention to what we call the "usual suspects" - the number of outsiders on boards, director shareholdings, board size, and whether the CEO also holds the Chair position (CEO duality) - does not yield either strong research results or more robust corporate governance in practice. In this article we argue that the "usual suspects," as measured by the classic indicators, do not ensure a truly independent board and that the key to making boards work better rests in an area largely ignored by researchers: board process. Based on structured interviews with members of corporate boards, we open a window to what is really going on inside boardrooms. Our analysis suggests five critical goals for which all boards should strive and presents a detailed checklist of recommendations for directors on how best to realize these goals.