Director knowledge, shared leadership, and board service performance

Abstract

This study examines the coordinative and integrative function of shared leadership that can enable board members to better leverage their specialized expertise and achieve higher board service performance in a private firm context. Furthermore, we examine an important but overlooked antecedent of shared leadership within the board, namely the extent to which board members have a clear understanding of who possesses which knowledge and skills within the board. Using a unique multi-respondent sample of 32 boards, we find an indirect relationship between board members' awareness of each other's knowledge and skills and board service performance. We find that shared leadership serves as a mediator on this relationship. By taking a leadership perspective, our study explicitly responds to recent calls to focus on mediating variables that affect a board of director's service performance. These findings have some important implications for both academic research and governance practices.