Mitigating the toxic director: Strategies for identifying and managing toxic behavior to prevent exponential costs
Year: 2025
Type: article
Abstract: Toxic boardroom dynamics threaten the integrity of corporate governance, leading to financial losses, regulatory scrutiny, and stakeholder mistrust. This article proposes a decision-tree framework designed to systematically identify, document, and mitigate toxic behaviors before it escalates. Using international case studies, we demonstrate how unchecked board toxicity leads to governance failures, reputational damage, and ESG misalignment. The framework integrates legal principles, behavioral psychology, and corporate governance best practices, equipping boards with a structured intervention process, including director dismissal when necessary. By adopting this proactive strategy, organizations can strengthen ethical leadership, reinforce investor confidence, and prevent exponential governance costs.
DOI: 10.22495/cbv21i1art4
Author: Keren Bar-Hava
Institution: Hebrew University of Jerusalem
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4407957469