Do Busy Boards Add Value to Standalone Firms Relative to Business Groups? Evidence from India

We investigate whether busy boards add more value to standalone firms compared to business group affiliated firms in India – an economy plagued with significant institutional voids. Using board composition data of the top 500 Indian firms spanning the period 2003 to 2006, we find that firm performance improves when its board changes from being a board with non-busy outside directors to a board with busy outside directors. Furthermore, directors' qualifications and experience determine their directorships and degree of busyness. We also find that firms affiliated with business groups exhibit a negative relationship to the number of busy outside directors