New research from the University of Notre Dame reveals a little-explored reason why board members sometimes resign: personal politics.
Directors are more likely to quit when they don’t share a new CEO’s ideology but will stick around when there’s political alignment, according to a study of S&P 500 companies led by John Busenbark, a professor of management at Notre Dame’s Mendoza College of Business. More than that, the flight response from board members who dislike a CEO’s politics is much stronger than the retention effect for directors who share a leader’s ideology, a finding that supports past psychological research.
“Human beings are disposed to dislike dissimilar others much more than they like people who are similar to themselves,” Busenbark tells Fortune.
His discoveries—which relied on political donations to determine whether a CEO or board member was more conservative, moderate, or liberal—are instructive for boards that value inclusion and trust that listening to diverse opinions leads to better decisions. Diversity of thought doesn’t necessarily follow demographic lines, though it can, says Busenbark, so directors should be aware of the knee-jerk instinct to reject differences.
Science shows that the antidote to this negative visceral reaction is exposure, the professor adds. The lesson for board members? If you loathe an incoming CEO, take the time to get to know them before bailing. And during a CEO search, embrace candidates whose ideologies don’t fully mirror your own.
Though Busenbark's research showed that political extremism is uncommon in company leadership, and that CEOs are moderately conservative while board members' politics tend to be more polarized, slight political differences can be enough to cause friction, if only on an unconscious level.
Notably, the new study only looked at data from 2008 to 2012, before CEO activism went mainstream. Far more directors today are paying attention to candidates’ political history during the recruiting process. That might lead to a push for even more moderate CEOs, those who won’t make waves, Busenbark theorizes. However, smart boards will resist that fate.
Lila MacLellan
lila.maclellan@fortune.com
@lilamaclellan
