Board Size, Governance Effectiveness, and Higher-Education Closure

• In Event: Organizations, Occupations, and Work Section Roundtables
  In Refereed Roundtable (90 minute): Table 10: Organizational Change and Survival

Abstract

This study examines how board size relates to the survival of higher education institutions. Based on a longitudinal analysis of U.S. private nonprofit colleges and universities, we find a U-shaped relationship between board size and closure risk, with the pattern substantially more pronounced among smaller institutions. These findings are consistent with the argument that while initial increases in board size may provide benefits through enhanced resource acquisition and more diverse input, excessively large boards can create coordination and accountability challenges that crowd out effective oversight and timely strategic intervention. Given their greater resource needs and more limited buffering capacity, smaller institutions appear to experience both stronger benefits from modest board expansion and sharper disadvantages when board size exceeds a moderate level. Our study provides important insight into how the complex functioning of governing boards is associated with size, underscoring the importance of maintaining effective governance through a balanced, moderate size board. This insight is particularly important in highly competitive environments such as contemporary higher education, where organizations must navigate environmental shifts and intensifying competition, making timely and effective governance increasingly critical for survival.

Authors

• Dali Ma, Drexel University

• Suri Lee