I use data on 252 U.S. firms between 1994 and 2000 to study the relationship between audit committees and boards of directors with financial reporting quality. I initially document several changes in committee and board profile during the sample period. Results from logistic regressions suggest that measures of audit committee and board structure are related to earnings quality in a manner that is generally consistent with the predictions of agency theory. This study contributes to extant knowledge by employing different earnings quality measures from prior studies, and by expanding the range of audit committee attributes deemed important in determining audit committee performance.

For 307 firms over the 1990–1994 period, I find that board meeting frequency is related to corporate governance and ownership characteristics in a manner that is consistent with contracting and agency theory. The annual number of board meetings is inversely related to firm value. This result is driven by increases in board activity following share price declines. I further find that operating performance improves following years of abnormal board activity. These improvements are most pronounced for firms with poor prior performance and firms not engaged in corporate control transactions. Overall, my results suggest that board activity, measured by board meeting frequency, is an important dimension of board operations.

We study how corporate boards and audit committees are associated with voluntary financial disclosure practices, proxied here by management earnings forecasts. We find that in firms with more effective board and audit committee structures, managers are more likely to make or update an earnings forecast, and their forecast is less likely to be precise, it is more accurate, and it elicits a more favorable market response. Together, our empirical evidence is broadly consistent with the notion that effective corporate governance is associated with higher financial disclosure quality.

We study board executive committees for which, despite their broad powers, there exists limited empirical evidence. We find empirically robust evidence that firms with executive committees have lower market values. We also identify a link between executive committees, CEO turnover, and investment policies. This evidence suggests that, on balance, the agency and information costs associated with executive committee use outweigh the corresponding benefits. Together with technological advancements, our findings help to explain the sharp decline in executive committee use in recent years.

We study the role of outside directors in defined benefit pension plan freezes, where the interests of shareholders are in apparent conflict with the interests of firm employees. We examine the effect of independent directors on the likelihood, valuation effects, and long term consequences of plan freezes. We find that a greater percentage of independent directors makes plan freezes more likely and more valuable to shareholders, and mitigates their effect on investment and leverage levels. Our results extend evidence on the monitoring value of independent directors from shareholder-manager to shareholder-employee conflicts, consistent the predictions of agency rather than stakeholder management theories of independent director behavior.