Values, Processes and Decision-Making in Boards of Directors
Schultz, Erik LU
(2026)
In Lund Studies in Economics and Management
- Abstract
- This thesis aims to advance our understanding of how directors’ values influence board decision-making and firm behavior by developing and testing a model that integrates insights from behavioral perspectives on boards of directors and corporate governance. Ideally, boards engage in intensive and open discussions that utilize the full cognitive capacity of their members. However, in practice, they are often constrained by group psychological processes that inhibit such functions and render the board dysfunctional to varying degrees. Hence, this thesis argues for the necessity of a meso-level board orientation construct, which should not be assumed to directly reflect the values (or ideologies) of individual directors.
It also... (More) - This thesis aims to advance our understanding of how directors’ values influence board decision-making and firm behavior by developing and testing a model that integrates insights from behavioral perspectives on boards of directors and corporate governance. Ideally, boards engage in intensive and open discussions that utilize the full cognitive capacity of their members. However, in practice, they are often constrained by group psychological processes that inhibit such functions and render the board dysfunctional to varying degrees. Hence, this thesis argues for the necessity of a meso-level board orientation construct, which should not be assumed to directly reflect the values (or ideologies) of individual directors.
It also develops and tests a model that treats board orientation as an outcome of directors’ values, moderated by board processes, and evaluates this model empirically. It consists of four independent studies: (i) a systematic literature review of extant research on values in and around boards of directors, (ii) a study of director-level values and their influence on the board’s orientation, (iii) an investigation of the influence of board orientation on strategic decision-making (specifically, CEO dismissal), and (iv) a study of contractual delegation of decision rights and responsibilities from the board of directors to the CEO. Findings suggest that directors’ values significantly influence board orientation, moderated by attention structures such as the board’s agenda. However, there is no empirical support that board orientation influences boards’ strategic decision-making.
Finally, the thesis concludes by discussing possible explanations for this apparent disconnect between deliberation and decision. Two explanations are advanced. First, the small elite network of Swedish corporate governance and the relative homogeneity of educational backgrounds may lead to decision-making isomorphism. Second, boards may function primarily in an advisory capacity to controlling owners, who ultimately have the final authority in strategic matters. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/d2b8884c-553c-4647-a47c-a7e25d9f2688
- author
- Schultz, Erik
LU
- supervisor
- opponent
-
- Associate Professor Veltrop, Dennis, University of Groningen
- organization
- publishing date
- 2026-05-08
- type
- Thesis
- publication status
- published
- subject
- keywords
- board of directors, values, ideology, board orientation, board processes
- in
- Lund Studies in Economics and Management
- issue
- 181
- pages
- 260 pages
- publisher
- Media-Tryck, Lund University, Sweden
- defense location
- EC3:207
- defense date
- 2026-05-29 14:15:00
- ISSN
- 0284-5075
- ISBN
- 978-91-8104-944-2
- 978-91-8104-943-5
- language
- English
- LU publication?
- yes
- id
- d2b8884c-553c-4647-a47c-a7e25d9f2688
- date added to LUP
- 2026-05-07 13:00:47
- date last changed
- 2026-05-12 03:12:46
@phdthesis{d2b8884c-553c-4647-a47c-a7e25d9f2688,
abstract = {{This thesis aims to advance our understanding of how directors’ values influence board decision-making and firm behavior by developing and testing a model that integrates insights from behavioral perspectives on boards of directors and corporate governance. Ideally, boards engage in intensive and open discussions that utilize the full cognitive capacity of their members. However, in practice, they are often constrained by group psychological processes that inhibit such functions and render the board dysfunctional to varying degrees. Hence, this thesis argues for the necessity of a meso-level board orientation construct, which should not be assumed to directly reflect the values (or ideologies) of individual directors.<br/><br/>It also develops and tests a model that treats board orientation as an outcome of directors’ values, moderated by board processes, and evaluates this model empirically. It consists of four independent studies: (i) a systematic literature review of extant research on values in and around boards of directors, (ii) a study of director-level values and their influence on the board’s orientation, (iii) an investigation of the influence of board orientation on strategic decision-making (specifically, CEO dismissal), and (iv) a study of contractual delegation of decision rights and responsibilities from the board of directors to the CEO. Findings suggest that directors’ values significantly influence board orientation, moderated by attention structures such as the board’s agenda. However, there is no empirical support that board orientation influences boards’ strategic decision-making.<br/><br/>Finally, the thesis concludes by discussing possible explanations for this apparent disconnect between deliberation and decision. Two explanations are advanced. First, the small elite network of Swedish corporate governance and the relative homogeneity of educational backgrounds may lead to decision-making isomorphism. Second, boards may function primarily in an advisory capacity to controlling owners, who ultimately have the final authority in strategic matters.}},
author = {{Schultz, Erik}},
isbn = {{978-91-8104-944-2}},
issn = {{0284-5075}},
keywords = {{board of directors; values; ideology; board orientation; board processes}},
language = {{eng}},
month = {{05}},
number = {{181}},
publisher = {{Media-Tryck, Lund University, Sweden}},
school = {{Lund University}},
series = {{Lund Studies in Economics and Management}},
title = {{Values, Processes and Decision-Making in Boards of Directors}},
url = {{https://lup.lub.lu.se/search/files/249483229/Erik_Schultz_-_WEBB.pdf}},
year = {{2026}},
}