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Foreign board members and firm innovativeness: An exploratory analysis for setting a research agenda

Makkonen, Teemu, Williams, Allan and Habersetzer, Antoine (2018) Foreign board members and firm innovativeness: An exploratory analysis for setting a research agenda Corporate Governance, 18 (6). pp. 1057-1073.

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Purpose: This study seeks to assess the often repeated, but empirically unconfirmed, supposition that there is a positive connection between foreign board members (FBMs) and firm innovativeness, and to set a research agenda for future studies on the topic.

Design: The analyses are based on a large sample of firms within the European Union, utilizing patent and trademark data together with information on the national diversity of the boards.

Findings: The analyses confirm that there is a positive association between FBMs and firm innovativeness. Contrary to expectations, FBMs from less innovative countries than the countries of their host companies are more often associated with innovative firms than are FBMs from more innovative countries.

Research implications: This study provides empirical support for propositions, drawn from resource dependency theory and group effectiveness/diversity theories, that diverse boards of directors can lead to greater firm-level creativity and innovativeness. It also outlines a detailed research agenda for future studies to build on the tentative findings presented in this paper.

Practical implications: The findings suggest that greater national diversity in the board of directors can enhance innovation.

Originality: Earlier studies on board diversity have not analysed empirically the issue of national diversity. The originality of this paper lies in its attempt to address this gap in the corporate governance literature.

Item Type: Article
Divisions : Faculty of Arts and Social Sciences > School of Hospitality and Tourism Management
Authors :
Makkonen, Teemu
Habersetzer, Antoine
Date : 2018
DOI : 10.1108/CG-12-2017-0301
Copyright Disclaimer : © Emerald Publishing Limited 2018. Published by Emerald Publishing Limited. Licensed re-use rights only.
Uncontrolled Keywords : Board of Directors; Corporate Governance; Diversity; European Union; Foreign Board Members; Innovation
Depositing User : Clive Harris
Date Deposited : 28 Mar 2018 09:59
Last Modified : 26 Oct 2018 13:10

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