Session 115

Board Member Characteristics and Board Diversity

Track O

Date: Tuesday, October 9, 2012

 

Time: 08:00 – 09:15

Common Ground

Room: Terrace 2


Facilitator:

  • Katalin Takacs Haynes, University of Delaware

Title: Board Heterogeneity, Board Connectedness, and the Adoption of Innovations

Authors

  • Whitney Douglas Fernandez, San Diego State University

Abstract: Resource dependence perspective conceptualizes boards of directors as providers of important resources that help firms formulate and execute strategic actions. A considerable amount research is concerned with how boards provide one important resource in particular: information. The majority of these studies focus on either board heterogeneity or board network ties as the mechanisms through which this information is provided to firms. This paper integrates these two major arguments by examining the role and relative importance of board heterogeneity and board network ties in the dissemination of novel practices. Specifically, I argue that in the absence of board diversity, firms will rely more heavily on network ties to provide them with information about novel ideas and practices.

Title: Caste in the Boardroom: The Origins of Indian CEOs

Authors

  • Naga Lakshmi Damaraju, Indian School of Business
  • Anil Makhija, Ohio State University
  • Scott Yonker, Indiana University

Abstract: In this paper, we examine the role of Hindu castes and other religions in the appointments of 854 CEOs during the period 2001-2009 by the largest 1,000 firms listed on the Bombay and National Stock Exchanges. We document a significant preference for in-group hiring of CEOs and a large bias in non-hiring of lower castes and persons of other religions among family firms, the predominant ownership form in India. Yet, this socially troubling finding may nevertheless be economically efficient and may explain the long-term persistence of the caste system, an aspect we examine (in process) in terms of differentials in firm performance between in-group and out-group CEO hires. We also examine the selection and performance of certain out-group (professional) CEO hires from elite educational institutions to assess potential factors that may mitigate a same-caste bias.

Title: Diversity of What? Multifaceted Boards and Directors

Authors

  • Amy Hillman, Arizona State University
  • Sabina Nielsen, Copenhagen Business School
  • Alessandro Zattoni, Bocconi University

Abstract: Board diversity has long intrigued practitioners and scholars. Constituents encourage companies to vary of director characteristics, but companies often resist. Academics debate whether diversity is beneficial for board decision-making and the empirical evidence is mixed, partly because “diversity” is treated as a singular construct despite representing many different forms (e.g. demographic, human capital and social capital). We propose a theoretical model of board diversity at the group level and within individual directors to predict how various forms of diversity influence board monitoring and resource provision. We suggest some forms of diversity are complementary while others are substitutes when influencing these important outcomes. The implications of our model are important for further work on board diversity, board performance, and public policy aimed at diversity objectives.

Title: Does Board Capital Always Enhance Explorative Innovation?

Authors

  • Nami Kim, Korea University

Abstract: The purpose of this study is to fill up further explanations of insufficient part of a directors’ influence on the firm’s R&D strategy, bringing the balanced approach of directors' roles. Specifically, drawing upon resource dependence theory, this study suggests that a diverse board capital influences the explorative innovation of a firm. This study argues that an inverted U shape relation between board capital diversity and explorative innovation performance beyond a certain point. Furthermore, it scrutinizes how board capital influences the explorative innovation changes according to the decision maker’s perspective, which is based on their interests. To test the hypotheses, board capital data were obtained from 108 Korean companies in the manufacturing industry that considered R&D capability to be one of their core competencies.

Title: The Effect of Board’s Human and Social Capital on Firm Performance: A Comparative Institutional Analysis

Authors

  • Toru Yoshikawa, Singapore Management University
  • Anja Tuschke, University of Munich

Abstract: This study aims at investigating how institutional logics influence the efficacy of a board’s human and social capital to enhance performance measures across different institutional contexts. We theorize that human capital is more influential in a context categorized as individualistic while social capital is more effective in a collectivistic context. In addition, we expect human capital to be more closely linked with the monitoring function of boards while social capital may rather be used to address resource provision needs. We test our assumptions in a comparative study encompassing the U.S., Germany, and Singapore. Preliminary results for the effect of board network ties (social capital) and various measures of human capital (diversity of directors’ functional background, educational level, tenure) largely support our predictions.

Title: The Influence of Board Minority Representation on Corporate Philanthropy: Juxtaposing Contrasting Explanations

Authors

  • Heidi Wechtler, Macquarie University
  • Stelios Zyglidopoulos, University of Cambridge
  • Mariano Heyden, University of Newcastle
  • Pavlos Symeou, Cyprus University of Technology

Abstract: In this study we examine the impact of Board of Directors gender and ethnic minority representation on Corporate Philanthropy. Drawing on the corporate governance and corporate social responsibility literature, we catalog diverging views on the influence of board diversity on Corporate Philanthropy. We catalog arguments for both sides of the debate and test competing hypotheses concerning the influence of gender and minority representation on the likelihood and level of involvement in Corporate Philanthropy. The findings from our panel data analysis, comprising 3407 firm-year observations from US firms from 1998-2008, provides compelling evidence as to how board ethnic and gender representation influences the likelihood and level of firm involvement in Corporate Philanthropy.

All Sessions in Track O...

Sun: 08:00 – 09:15
Session 119: Strategic Leadership
Sun: 09:30 – 10:45
Session 120: Corporate Governance
Sun: 11:15 – 12:30
Session 122: Strategic Leadership and Corporate Governance Complementarities: Why we Are an IG
Sun: 15:15 – 16:30
Session 107: The Benefits of Experience: Vicarious and Otherwise
Mon: 08:00 – 09:15
Session 106: Why do Firms do Bad Things and What Do We Know about It?
Mon: 09:30 – 10:45
Session 103: Reputation: Organizational and Individual Dimensions
Mon: 13:30 – 14:45
Session 112: CEO and TMT Turnover: Firm Implications
Session 214: CEOs and Leadership
Mon: 16:30 – 17:45
Session 113: Large Shareholders are Doing it for Themselves
Tue: 08:00 – 09:15
Session 115: Board Member Characteristics and Board Diversity
Session 137: CEO Human Capital: Take a Little off the Top
Session 254: Capital Markets and Efficiency
Tue: 11:00 – 12:15
Session 111: Why Boards Look the Way They Do: Director Selection
Session 117: Heterogeneous Owner Types and their Influence
Tue: 14:15 – 15:30
Session 108: CEOs Matter, Don\'t They?
Session 116: Discretion and Compensation
Tue: 15:45 – 17:00
Session 114: Adoption of a Practice and its Implications
Tue: 17:30 – 18:45
Session 118: The TMT as a Unit
Session 215: CEO Personality and Characteristics Influencing Decision Making


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