Nonprofit boards

Size, performance and managerial incentives

Rajesh K. Aggarwal, Mark E. Evans, Dhananjay Nanda

Research output: Contribution to journalArticle

23 Citations (Scopus)

Abstract

We examine relations between board size, managerial incentives and enterprise performance in nonprofit organizations. We posit that a nonprofit's demand for directors increases in the number of programs it pursues, resulting in a positive association between program diversity and board size. Consequently, we predict that board size is inversely related to managerial pay-performance incentives and positively with overall organization performance. We find empirical evidence consistent with our hypotheses. The number of programs is positively related to board size. Board size is associated negatively with managerial incentives, positively with program spending and fundraising performance, and negatively with commercial revenue, in levels and changes.

Original languageEnglish (US)
Pages (from-to)466-487
Number of pages22
JournalJournal of Accounting and Economics
Volume53
Issue number1-2
DOIs
StatePublished - Feb 2012

Fingerprint

Managerial incentives
Board size
Empirical evidence
Organizational performance
Nonprofit organization
Incentives
Enterprise performance
Performance pay
Fund raising
Revenue

Keywords

  • Boards of directors
  • Incentives
  • Nonprofits

ASJC Scopus subject areas

  • Accounting
  • Economics and Econometrics
  • Finance

Cite this

Nonprofit boards : Size, performance and managerial incentives. / Aggarwal, Rajesh K.; Evans, Mark E.; Nanda, Dhananjay.

In: Journal of Accounting and Economics, Vol. 53, No. 1-2, 02.2012, p. 466-487.

Research output: Contribution to journalArticle

Aggarwal, Rajesh K. ; Evans, Mark E. ; Nanda, Dhananjay. / Nonprofit boards : Size, performance and managerial incentives. In: Journal of Accounting and Economics. 2012 ; Vol. 53, No. 1-2. pp. 466-487.
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