Emerging Economies, Institutional Voids, and the Role of Busy Boards in Firm Performance

This paper extends the literature on multiple directorships by investigating the relation between busy boards and firm performance for the top 500 Indian firms during 2003 to 2006. Busy boards are found to be positively associated with firm performance. We also show that directors’ qualifications and age determine their busyness. Standalone firms, which require more reputational capital, tend to have a significantly greater number of busy outside directors. These findings support the notion that busy boards add significant value to corporations in emerging economies even if they do not add value in developed markets.busy boards, corporate governance, reputational capital, firm performance