Recommendations of codes on board independence do not match the predictions of optimal board structure theories. We investigate whether firms solve this tradeoff between optimal and recommended levels with gray independent directors, those who do not achieve the formal requirements of...

This paper analyzes the characteristics of firms that declare board directors as independents, although the directors are not strictly independent, and examines the consequences in terms of performance and corporate governance outcomes. Based on publicly available information, eight criteria of...

Based on the optimal board independence theory, we analyze how Spanish listed firms determine the presence of genuine and gray independent directors. We classify independents as gray whenever they do not satisfy formal independence requirements. Given the findings in previous literature, this...