This dissertation includes two related chapters that investigate corporate governance. In the first chapter, we examine the effectiveness of board monitoring on CEOs. It is widely believed that outsider boards are better monitors. In fact, regulations now require that the board of directors of publicly traded firms be composed of a majority of independent directors (or outsiders). However, this paper documents that an insider-dominated board can monitor the CEO just as well as an outsider board can when the firm's CEO is hired from outside. The results suggest that what matters is not so much as the structure of the board, but the "independence" between the board and the CEO it monitors. Specifically, we find that insider boards monitor more of their firms' CEOs if the CEO is hired from outside than from within. In addition, outsider boards monitor both inside and outside CEOs the same way. We also find little difference between insider and outsider boards when they monitor outside CEOs. The main contribution of this paper is to show that an insider board can be an effective monitor as long as it is independent of the CEO. In other words, what is important is board independence, not board structure per se. In chapter two, we examine the relation between the change in a firm's value and its CEO selection sources: internal promotion versus external hire in both high and low product competition environments. Our results show that firms will be better off hiring an outside CEO (external hire) when the firms operate in a low product competition industry. Specifically, the evidence shows that hiring an outside CEO for a firm in a low product competition industry will increase the firm's value by about 3% for the entire tenure of the CEO. The main contribution of this paper is to show that product market competition is an important factor in CEO selection.

More companies have responded to the call for action, increasing their attention to the 17 Sustainable Development Goals. Corporate governance structures have proven to have an effect on how well companies are able to facilitate a sustainable trajectory, all influenced by values and norms. Sweden is part of what many views as the ‘next supermodel’ regarding social welfare and sustainability awareness based on a collectivist mindset. In contrast, the US fundamentally believes in the American dream of free enterprise, which has resulted in a more shareholder oriented view.   This study aims to research whether board composition mechanisms such as board gender diversity, board independence, inclusion and CEO duality impact the CSR initiatives, measured through ESG score, of Swedish and US Large Cap companies listed on OMXS and S&P 100. Moreover, it strives to investigate plausible reasons for differences between Sweden with the Nordic corporate governance model and the tier-1 model corporate governance model the US have. Even if ESG is a well-studied area, previous research does not find any consensus since earlier studies find negative, positive and non-significant results. Furthermore, many studies tend not to go beyond firm-level factors and overlook country-level factors such as national culture.   The study consists of 165 Large Cap companies, where 83 are Swedish and 82 are from the US. The chosen research method is quantitative, based on unbalanced panel data from 2020-2022. ESG score is used as the dependent variable, and the independent variables are the proportion of women board of directors, the critical mass of women directors, the proportion of independent directors, inclusion and CEO duality. The control variables consist of board size, asset size, return on assets, leverage, board-specific skills, and the number of employees. To control for country-level factors, GDP is applied. The regression also applies fixed effects for year and sector.   The data analyses are done with two robust and one standard GLS model with random effects, where the regression analyses are divided into two parts. Part I combines Swedish and US Large Cap companies, and Part II separates the two countries. The results for Part I show no significant relationship between ESG score and either board gender diversity, the critical mass, inclusion or CEO duality. The degree of board independence shows a significant positive effect on ESG scores. Part II conveys that there are fundamental differences between Sweden and the US. For example, while board independence shows a significant positive relationship in Sweden, it presents a non-significant negative relationship in the US. In addition, GDP shows significance in both models indicating that country-level factors matter, and it is evident that the explanatory power of the regressions differ. Thus, it is evermore likely that other factors, such as national culture, potentially impact companies’ corporate social responsibility.