This study examines the relationship between proxy contests and how they impact the careers of incumbent directors – and finds that the battles cost nominated directors is 60% greater than non-nominated ones. Here is an excerpt:
We show that proxy contests are associated with significant adverse effects on the careers of incumbent directors. First, following a proxy contest, incumbents lose seats from targeted boards. Three years after the proxy contest, more than 39% of the directors will not be on the board of the targeted company. Furthermore, following a proxy contest, directors experience a significant decline in the number of seats on other boards. The total number of other directorships falls by more than 17% over the three years after the proxy contest.
Overall, facing a direct threat of removal is associated with $1.3-$2.9 million in foregone income until retirement for the median incumbent director. The authors also conclude that there is a causal effect of proxy contests on director careers by studying the difference in career effects between nominated and non-nominated directors on staggered boards that are the target of a proxy contest.