SSRN-Are Large Boards Poor Monitors? Evidence from CEO Turnover by Olubunmi Faleye
Faleye who reports that large boards of directors are less likely to replace existing CEOs and if the CEO replaced, less likely to find a successor from outside the firm.
Moreover, when firms announce smaller boards, the firm's stock return is positive. Thus Faleye concludes: "suggest that a large size hinders the board's ability to perform its monitoring functions, and lends additional support to the current drive toward smaller boards."
Ok, let me see if I have this right. Size does matter and smaller is better?