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Sensor Review publishes the results of a major sensor survey.

We document the emergence of the Lead Independent Director (LID) board role in a sample of U.S. firms from 1999–2015. We find that firms that adopt an LID board role are larger and have more independent boards, higher institutional investor holdings, and an NYSE listing. Firms with greater anticipated benefits from monitoring also adopt an LID role, e.g., firms with dual CEO-Chairman, with more takeover defense mechanisms, and with higher cash holdings. Using an event study methodology, we find that investors respond positively to the adoption of an LID board role. Lastly, using instrumental variables to address endogeneity in the LID board role, we find that firms with an LID are more likely to terminate poorly performing CEOs. Taken as a whole, these results suggest that the LID board role enhances firm value and improves the quality of corporate governance.

The pressure on the food industry and society as a whole to evolve towards more sustainable production and consumption has increased in recent years. There are a number of drivers that can help reduce environmental impacts including legislative instruments, retail marketing and consumer choices and demand. One driver that has received attention recently is the use of product labels, either on a single issue or on multiple issues (using omni‐labelling). The purpose of this paper is to report on a framework that emerged from a wider study exploring effective approaches to environmental labelling of food products.

Techniques for assessing the environmental impacts of food production were reviewed and a consultation was undertaken with industry and consumer experts to ascertain their views (using multi‐criteria mapping) on the practicality and efficacy of environmental labels.

The wider study found that although the science is not sufficiently robust to develop an outcome‐based, environmentally broad, omni‐label at this time, there is a role for environmental labelling in conjunction with other initiatives to improve the sustainability of food production and consumption. The framework presented aims to support this role and help improve the practicality and efficacy of environmental labels. It provides a series of interrelated guidelines which provide a basis for developing more effective, robust, credible and practical environmental labels for food.

The framework can be used to design new, or evaluate existing labelling schemes and to identify opportunities for improvements. The process is illustrated with an application to four existing schemes.

Eco‐labelling of food products is gaining interest globally, but there are numerous issues that need to be fully understood in order to develop credible and robust labelling systems.

This paper aims to propose a multiobjective branch and bound (MOBB) algorithm with a new criteria for the branching and discarding of nodes based on Pareto dominance and contribution metric.

A multiobjective branch and bound (MOBB) method is presented and applied to the bi-objective combinatorial optimization of a safety transformer. A comparison with exhaustive enumeration and non-dominated sorting genetic algorithm (NSGA2) confirms the solutions.

It appears that MOBB and NSGA2 are both sensitive to their control parameters. The parameters for the MOBB algorithm are the number of starting points and the number of solutions on the relaxed Pareto front. The parameters of NSGA2 are the population size and the number of generations.

The comparison with exhaustive enumeration confirms that the proposed algorithm is able to find the complete set of non-dominated solutions in about 235 times fewer evaluations. As this last method is exact, its confidence level is higher.

The existing literature involving director compensation has been concentrating on its absolute or intrinsic values. Although the relevant studies have generated mixed findings, research in other fields suggests that the power of an incentive may be determined by its value relative to the chosen referencing standard more than its absolute value. This study aims to investigate how relative director pay affects corporate investment efficiency.

This study takes a fresh theoretical viewpoint by framing the investigation using the dimensional comparison theory and proposing that a directorship also presents a relative value that may influence the board’s performance. Ordinary least squared regressions and two-stage system generalised method of moments are used to analyse 14,267 firm-year observations.

The empirical results suggest that the relative director pay is a better estimate of the power of the incentive than the absolute pay. A positive association between the relative director pay and investment efficiency is evident, while the absolute pay has no significant effect on investment decisions. Director overcompensation, however, will cancel out the positive effect of director compensation on investment efficiency. Firms with relatively lower unexpected investment (UI) level benefit the most from an increase in the relative director pay, while neither absolute nor relative director pay affects investment choices in firms with a high UI level because of significantly more overcompensation.

To the best of the authors’ knowledge, this study is the first attempt to investigate the effect of relative director pay. It is also the first to examine the role of dimensional comparison in strategic decisions which is the single untended comparison framework in the director pay design. The current director pay structure has emphasised social and temporal equality by standardising the pay structure and vesting the equity-based pay over a long period. Yet it ignores the fact that people decide their commitment level by comparing the reward with an internal referent too. The findings speak to the dimensional comparison theory in that the inequality emanated from dimensional or internal comparison may be accentuated by the perceived equality in other comparison frameworks, driving the different performances in the roles one assumes.

Pulchronomics studies the economics of beauty. The purpose of this paper is to research CEO pulchronomics by examining whether a beauty premium exists in CEO compensation and whether this beauty premium is justified by differences in CEO performance.

The authors calculate a facial attractiveness scores (FAS) based on facial symmetry, facial structure and the golden ratio. The authors then perform OLS regressions to examine the effect of CEO beauty on CEO compensation and firm performances.

The authors find that base salaries for attractive CEOs are higher than those for unattractive CEOs, but incentive pays for attractive CEOs are not different from those for unattractive CEOs. The latter is likely due to the fact that attractive CEOs do not outperform unattractive CEOs in operations, innovation, corporate social responsibility and financial reporting quality.

Since the CEO beauty premium is not supported by the superior performance of attractive CEOs, this paper provides new evidence of appearance discrimination in CEO compensation.

This paper aims to investigate the roles of non-CEO inside directors (NCIDs) in the new CEO-firm matching process using the context of unplanned CEO departures when immediate CEO succession planning becomes a sole board responsibility. Although critics argue that inside directors decrease the monitoring effectiveness of a board, inside directors arguably possess superior firm-specific experience and knowledge that can be beneficial during the leadership transition.

The authors use a comprehensive, manually collected data set of unplanned CEO departures from 1993 to 2012.

The authors find that NCIDs play an important role in the CEO transitioning process. They help firms identify qualified inside replacements and provide stability as the new permanent or interim CEO. In addition, NCIDs facilitate the transfer of information and help the new external CEOs succeed. They show that the longer the NCID stays with the company, the longer the tenure of the new CEO. They also document that the presence of NCIDs improves operating and stock performance; especially when the new CEO is hired from outside of the firm.

The impact of NCIDs is particularly important when the firm hires an outsider as the new CEO. These results suggest that board composition affects frictions in the CEO labor market.

The literature has predominantly focused on the downside of having inside directors. Too many inside directors on a firm’s board is often associated with ineffective boards and entrenchment. To the contrary, the authors focus on a potential benefit of having inside directors.

This paper aims to investigate the impact of Australian Chief Financial Officers (CFOs) as board insiders on firm performance and earnings quality with reference to agency theory and theory of friendly board.

The ordinary least square, two-stage least-squares and propensity score matching regressions are performed with various proxies for firm performance and accruals quality.

Firms with CFOs as board insiders experience significantly lower firm performance and earnings quality. In firms with powerful CEOs, the negative impact of CFO board membership on earnings quality is further magnified. Additionally, the negative impact of CFO board membership on firm values and earnings quality is only present in firms with bigger boards or firms with less outside directors. The findings are consistent with the agency perspective and in sharp contrast to the US market.

This is the first Australian study to examine the impact of CFO board membership on firm performance and earnings quality. The findings suggest that the monitoring of executives is best done by a small or independent board and that the insider board membership should be optimised.

The purpose of this paper is to conduct a comprehensive analysis and synthesis of the splintered chief executive officer (CEO) succession literature and provide a unifying future research agenda.

This review content analyzes 227 relevant articles published after 1994. These articles examine the causes, process, replacement, and consequences of CEO succession.

The review develops a comprehensive typology, identifies gaps in the literature, and proposes opportunities for future research. For instance, the CEO succession literature can be classified along four primary dimensions: when, how, who, and consequences. These four primary dimensions are further explained by ten secondary factors and 30 tertiary components. Research opportunities include: enlarging the data pool to expand the repertoire of firms studied, incorporating the CEO’s perspective, and integrating CEO succession research with literatures in selection, turnover, and human capital theory.

Through integrating research across research domains, future research will be able to better predict when CEO succession will occur, how to avoid unwanted CEO succession, how to better implement CEO succession, and how to minimize negative aspects and maximize positive aspects of CEO succession for the firm and the CEO, as well as understand the consequences of CEO selection, and help move toward and understanding of how to prevent poor performance, and retain high performing CEOs.

This is the first comprehensive review since 1994. It creates a typology to guide and categorize future research, and shows ways to incorporate relevant, but often ignored literatures (e.g. human resources, psychology, decision making, and human capital).

New Zealand reintroduced titular honours (i.e. knighthoods and damehoods) in 2009. We document the prevalence of knights and dames on the board of directors.

We use a probit regression to investigate what firm characteristics are significantly associated with having a knight or dame on the board of directors.

We find 19 of 112 companies have a knight or dame on the board. These companies are bigger and have larger and more independent boards than other companies. We also find a knight or dame is more likely to serve in companies that have higher dividend yields.

The generalisability of our results is limited by the small number of knights and dames on the boards of listed companies and our archival regression approach. Although we document an association, we cannot prove causation.

We show that directors with greater and easily visible reputational capital are more likely to supply their services to companies that mitigate risks to their reputation and protect minority shareholder interests.