Abstract
A company’s board of directors plays a critical role in making decisions relating to strategy, high-level structure, and the appointment of the CEO. The role of the board and its impact on corporate performance has been well studied; however, the diversity of the board of directors and the corresponding correlation to the level of corporate innovativeness has not been previously investigated. Here, we provide a critical analysis of board members’ diversity as it relates to innovative corporations in what is considered a mature industry in transition to a bioeconomy: the pulp and paper industry. Our findings contribute to the body of knowledge on the role of board member diversity in shaping company culture and how that drives, shapes, and sustains innovation.
Highlights
Companies are guided by three generic strategies: product leadership, customer intimacy, and operational excellence (Balas, 2015)
Strategy and structure establish the maximum level of firm performance possible and strategic alignment determines how close actual performance comes to that maximum
Our results showed that bioeconomy companies have more business majors than engineering majors on their boards
Summary
Companies are guided by three generic strategies: product leadership, customer intimacy, and operational excellence (Balas, 2015). Each of these strategic approaches is supported by the components of efficiency, service, and functionality. The quest for differentiation from competitors in a mature industry highlights the importance of innovation. Innovativeness is associated with a firm’s products, and with the organization’s ability to effectively align its strategy, structure, systems and leadership practices to support innovation. Effective alignment ensures that the company’s resources are deployed optimally to support the chosen strategy, including the ability to perform distinctive sets of activities that lead to a unique, i.e., differentiated mix of deliverables. The systemic understanding of market trends, value chain developments, and consumer or customer needs are some of the factors that contribute to an innovative corporation’s success (Xinchun et al, 2016; Chen, 2019; Jari and Sahebi, 2013)
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