Conclusions
In this study, we bring together the literatures on meeting frequency, director busyness and firm performance by examining whether increased director workloads are associated with lower director attendance rates, and by testing for the combined effect of increased director workloads and lower director attendance on firm performance.
Using a hand-collected dataset from Australia of the number of board and committee meetings held and attended by individual directors, we provide robust evidence that attendance rates for both outside and inside directors decrease as they are required to attend more meetings. Thus, documenting that higher director workloads are associated with increased director busyness and lower director attendance. We also find that director busyness moderates the relationship between meeting frequency and firm performance. When firms hold additional meetings, lower director attendance is associated with lower firm performance.
For shareholders and policymakers, our results indicate that more awareness is needed of the potential costs of increased director workloads. In general, directors are busy people and have a limited ability to take on higher workloads, such as attending additional meetings.
