This article explores how military experience among board directors can enhance CEO accountability. Research reveals that boards with military directors are more decisive in addressing underperformance, often leading to CEO dismissals. The authors analyze three key accountability principles derived from military leadership and offer insights on how any board can implement them to effectively oversee their CEO's performance.
CEOs are seldom dismissed when the company they lead underperforms, in part because they wield considerable power over the board. So how can boards more effectively enforce CEO accountability in the face of poor performance? The authors recently analyzed boards of 865 U.S.-listed manufacturing firms between 2010 and 2020 and identified an often-overlooked source of accountability principles: the military.
Stevo Pavićević is an associate professor of strategy at the Frankfurt School of Finance and Management. His work has been published in top strategy and management journals, among them theis a professor and the chair in international management at the University of Zurich, Switzerland. He is a partner at the Next Advisors and the coauthor, with Marianna Zangrillo, of
CEO Accountability Board Of Directors Military Leadership Corporate Governance Performance Management
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