Characteristics Of Board Members Research Articles

Can board of directors’ faultlines improve corporate innovation performance? Evidence from China

Innovation, which is a pivotal force behind the sustained growth of enterprises, has garnered significant attention across various industries. As the epicenter of corporate decision-making, the board of directors plays a pivotal role in allocating resources and overseeing the execution of strategy. Consequently, it inevitably impacts the innovation capabilities of a business. Previous research has focused primarily on single board member characteristics, such as age, gender, tenure, and educational qualifications, overlooking the cumulative influence of multiple attributes. Therefore, this study aims to investigate the impact of faultlines arising from the intersection of these characteristics within a board on innovation performance. Using panel data from China’s A-share listed companies from 2010 to 2021, this research constructs a framework to analyze board faultlines based on gender, age, education, director tenure, independence status, and occupational background. A comprehensive examination reveals a positive association between board faultlines and innovation performance, indicating that diversity within a board can foster enhanced innovative outputs. These findings persist even after rigorous robustness tests, including two-stage instrumental variable regression using lagged innovation performance as well as when substituting explanatory variables and sample intervals. Further analysis reveals that the influence of board faultlines on innovation performance is significant only under certain contextual conditions: when equity concentration is low, industry competition is intense, and risk aversion is greater. This study offers valuable insights for optimizing board membership configurations and thus, ultimately, enhancing the innovation capabilities of enterprises.

Retracted: Empirical Research on Seasoned Equity Offerings, Board Member Characteristics, and Corporate Investment Efficiency

Retracted: Empirical Research on Seasoned Equity Offerings, Board Member Characteristics, and Corporate Investment Efficiency

The influence of board of directors’ characteristics on corporate social responsibility disclosures in Jordanian Islamic banks

In an era where organizations are increasingly recognizing the paramount importance of addressing societal and environmental concerns, corporate social responsibility (CSR) has emerged as a pivotal facet of contemporary business practices. Within the banking sector, Islamic banks assume a significant role in advocating ethical and socially responsible conduct. This study delves into the impact of the board of directors' characteristics on corporate social responsibility disclosures (CSRD) within Jordanian Islamic banks. Data were meticulously gathered from three Jordanian Islamic banks, all of which are listed on the Amman Stock Exchange (ASE), over the span of the years 2010 to 2022. Our findings illuminate that Jordanian Islamic banks, on average, disclose 47 percent of their CSR endeavors, marking a commendable level of transparency, particularly when contrasted with less developed economies. Notably, independent directors comprise 42% of the board composition, with the average age of board members standing at 41 years. Moreover, 8.10% of board members hold degrees in finance and accounting, while 0.24% possess professional experience within the Big Four accounting firms. On average, Jordanian Islamic banks convene 10.27 board meetings annually, and 48% of directors maintain multiple directorships. Significantly, our analysis underscores that all examined characteristics of board members have a favorable influence on CSR disclosure within Jordanian Islamic banks. This paper constitutes a substantial contribution to the extant literature by providing empirical substantiation of the nexus between the board of directors' characteristics and CSRD in Jordanian Islamic banks, with a specific emphasis on the unique domain of Islamic banking, which has hitherto received limited scholarly attention. Further avenues of research are recommended to explore additional variables and delve deeper into the intricate interplay between board characteristics, external contextual factors, and the disclosure of CSR activities.

Board Group Faultlines, Slack Resource, and Corporate Carbon Performance

A general consensus has been reached among many countries that low-carbon development is important for the protection of the environment and the mitigation of climate change. In line with the attitude of a responsible country, China urges enterprises to participate in energy conservation and emission reduction through various policies. Based on the faultline theory, this paper considers the data of 124 listed companies in China’s manufacturing industry from 2015 to 2019 as a research sample. From the perspective of corporate governance, this analysis discusses the influence of the aggregation effect of the multiple characteristics of board members on the environmental protection benefits of enterprises, and empirically studies the board group. The relationship between the faultline and the carbon performance of the enterprise is further investigated, and the internal slack resources of the enterprise are further investigated in relation to the board members and the moderating effect. The study found that the existence of the board’s bio-demographic-related faultline has a positive effect on the carbon performance level of enterprises, but it is not statistically significant. The existence of the board’s task-related faultline has a positive effect on the carbon performance level of the enterprise. Further research found that precipitated slack resources have a significant negative moderating effect on the relationship between the existence of boardroom faultlines and corporate carbon performance, and that the relationship had a positive moderating effect, but was not statistically significant. The preceding conclusions not only enrich the research on corporate internal governance in theory, but also provide useful guidance for how to improve corporate environmental protection behavior on a microlevel in practice.

The Impact of ESG and the Characteristics of the Board of Directors on Investment Efficiency: A Case Study of Chinese Listed Companies

The board of directors is an important organization leading the company's decision-making. The different personal characteristics of the members of the board of directors directly affect the choice of decision-making, and then affect the investment efficiency; Social responsibility is a behavior in that enterprises are closely connected with the external environment. Therefore, this paper takes Chinese listed companies from 2016 to 2020 as a sample and makes an empirical study with the Ordinary Least Square method to explore the impact of board characteristics and corporate social responsibility on corporate investment efficiency. The results show that: 1) the higher the proportion of male directors, the older the average age of directors, and the enterprises with no overseas background among directors, the more inclined to implement corporate social responsibility. 2) The better corporate social responsibility performance has a positive and significant impact on the company's investment efficiency. 3) The older the average age of the members of the board of directors, the company with no overseas background in the board of directors and no financial background in the board of directors, and the company with the same director as the chairman and general manager, the investment efficiency will be better. 4) The implementation of corporate social responsibility does not make up for the negative impact of the characteristics of board members on enterprise investment efficiency. This paper also puts forward corresponding suggestions based on the research findings.

Representation of women on editorial boards of ophthalmology journals: protocol for a cross-sectional study

IntroductionThere is a notable under-representation of women in leadership positions in ophthalmology despite the increasing number of women as ophthalmologists. Gender inequality in editorial boards of ophthalmology journals has not...

The relationship between board characteristics and social responsibility with firm innovation

PurposeThe present study aims to assess the potential impacts of board members' characteristics, including connectedness and independence, on the level of the firm's involvement in innovation and corporate social responsibility (CSR).Design/methodology/approachVariables of board members' interlock and independence are selected for measuring the board characteristics and their association with innovation. The range of disclosure of social responsibility (SR) of the firms inside and outside the industries is also analyzed through descriptive-correlational. The selected sample includes 280 firm-years listed firms on Iraq Stock Exchange during 2012–2017 and 1,026 firm-years on the Tehran Stock Exchange. The hypotheses are examined using multivariate regression models and panel data.FindingsThe observations show that board interlock and independence in both countries are willing to improve firms' innovation. Moreover, having controlled the industry index, the authors find that business environment innovation is willing to be transmitted into the firms through outside industry sources in Iran. In the Iraq country, regardless of industry index, the positive association between interlocked boards and firm innovation is established. Further analyses also articulate that board interlock is not considered a mechanism to transmit information and experiences about CSR activities.Originality/valueThis paper is a pioneer study to assess the relationship between board member characteristics and the firms' innovation and SR both in Iran and Iraq. Also, it extends the literature by considering the industry index as a significant source of knowledge and experience to gain more precise results. Therefore, the current paper may contribute to the development of knowledge in this field of study.

Retracted] Empirical Research on Seasoned Equity Offerings, Board Member Characteristics, and Corporate Investment Efficiency

Seasoned equity offerings (SEO) are an important approach for listed companies to obtain funds after an initial public offering (IPO), which plays a major role in enterprises’ demand for funds. However, due to agency conflicts, information asymmetry, tunneling by major shareholders, and other behaviors, listed companies sometimes fail to make proper use of the refinancing funds. In this study, the impact of SEO on corporate investment efficiency is tested. Furthermore, the impact of board member characteristics on investment efficiency of refinancing companies is tested. Refinancing listed companies in Shenzhen and Shanghai Exchange Stock from 2009 to 2020 form the research samples. The research shows that SEO reduces the corporate investment efficiency. According to the impact analysis of the board member characteristics on the investment efficiency of refinancing companies, age heterogeneity of the board inhibits investment efficiency. The older the mean age of directors, the higher the investment efficiency. Furthermore, sex heterogeneity also inhibits investment efficiency. The more female directors, the lower the investment efficiency. Moreover, overseas backgrounds and experiences of directors also inhibit investment efficiency. These findings not only extend the research on the consequences of SEO in China, but also provide reference points and guidance for listed companies to adopt a scientific and reasonable refinancing method, give full play to the advantages, and overcome disadvantages of board members.

The Effect of Board Characteristics on Corporate Social Responsibility Disclosure in the Jordanian Banks

A research was conducted to assess the influence of board member characteristics on corporate social responsibility disclosure (CSRD) within banking industries in Jordan where a total number of 155 banks per annum were sampled between the years 2010 and 2020. A hundred items have been developed as a checklist to evaluate the level of disclosure and the analysed results were comparatively low in terms of the level of disclosure for the selected banks in Jordan. To test the model, data from a time series and the ordinary least squares model have indicated the influence of three (3) factors that impacted positively on the disclosure of corporate social responsibility (concerning the board's size, board of foreign members and the audit committee). The present research thereby proposed that the directorate boards of commercial banks in Jordan need to create more awareness about corporate social responsibility, and implement proper monitoring activities in disclosing information on regular by the Central Bank of Jordan. However, any commercial bank that fails to comply with the rules and regulations should be sanctioned severely for indiscipline. This study became relevant by contributing meaningfully to literature where the quality of information of the banking industries could be improved to meet the novel trend by worldwide economic analysts. Furthermore, this research successfully carried out investigations on the impacts of CSRD level within the context of a new business environment, thereby projecting more guidelines for future works in a related discipline. However, the overall outcome from this study could be made to attract groups of stakeholders and shareholders like moderators, potential investors, and CSR and government officials.

The effect of corporate governance on bank performance: evidence from Turkish and some MENA countries banks

This paper examines the relationship between the structure of corporate governance and performance in the banking sector. A sample has been selected using the generalized method of moment (GMM) approach. The sample consists of data from a total of 33 Turkish, Tunisia, Morocco and Lebanon banks which are listed in stock during the period between 2012 and 2017. Since this paper emphasizes corporate governance, a “Board Characteristics Index” was developed based upon four different aspects of the board composition–board leadership structure, board member characteristics and board committee structure. It also demonstrates how the overall index relates to banking performance. The results show that the governance index, which aggregates with the four sets of board attributes relate significantly and positively with return on assets.

A Board Coaching Framework for Effective Nonprofit Governance: Staff Support, Board Knowledge, and Board Effectiveness

ABSTRACT Nonprofit boards of directors are responsible for the governance of their organizations. Despite a wide literature on board governance, empirical studies have focused primarily on board characteristics such as board size, frequency of board meetings, or board member characteristics. Building on prior literature, we use qualitative interview and survey data from nonprofit board members and executive directors, respectively, to develop a board coaching framework to better understand how board dynamics, in particular staff support for board activities, can influence overall board performance. Our findings suggest the need to recognize the central role executives and staff play in nonprofit governance.

Trust within sport NGB boards: association with board structure and board member characteristics

ABSTRACT Research question: Trust is a critical element within organisational and management literature. It reflects the decisions and behaviour of individual actors and the functioning of organisations and their management bodies. However, within the sport governance literature there is a notable absence of work focusing on trust. This study examines the association of trust and structural features within national governing bodies’ (NGBs) boards. Research methods: 242 board members of 65 NGBs from Germany participated in an online survey which comprised questions on trust indicators and boards’ structural features. Probit models were employed to analyse the association between trust indicators, individual board membership characteristics, and the boards' structural features. Results and findings: Results suggest that trust is a multifaceted phenomenon, affected by various (beneficial and detrimental) variables in the specific context of NGB boards. The study makes numerous interrelation and governance dynamics recognisable, with board size, board members’ skill differentiation and temporal stability of boards appearing to be particularly relevant. Implications: The paper complements the professionalisation literature and the leadership discussion in the context of sport governance, particularly with regard to trust-enhancing working conditions within boards. The study also aligns to the good governance literature, revealing that in some respects the issue may be seen to be about trade-offs between trust-based effects and their resultant (positive or negative) outcomes for organisation, board or individual.

Turning Board Sustainability Aspirations into Action

Boards are key to unlocking substantive action by firms on sustainability. We clarify their potential role and show how and why they are failing to deliver on that role and what can be done about it. We start by highlighting the importance of board engagement as a driver of sustainability and then report research evidence of limited board attention to the topic. This is short-sighted given the significance of sustainability but also as a matter of good corporate governance. Nonetheless, recent survey research provides encouraging evidence to suggest that many boards have the right aspirations when it comes to sustainability—they are convinced it is a strategic necessity. Often, however, they do not have what is required in terms of the people, knowledge and tools to turn those aspirations into meaningful action. Our in-depth interviews with board directors examined the obstacles to board attention to sustainability from inside the boardroom, including the characteristics of board members themselves. We identified five board sustainability archetypes: The Deniers, The Hard-headed, The Well-Meaning, The Complacent, and The True Believers. We characterize each archetype and explain how they can be identified by executives or consultants working with the board or by board members themselves. We offer recommendations for how to respond to the different archetypes and how more generally boards can advance the sustainability agenda.

Postgraduate Education of Board Members and R&D Investment—Evidence from China

Increasing research and development (R&D) investment has been a common strategy to advance the sustainable development of economy and competitiveness across the world. Instead of external determinants, exploring the influence of internal factors such as the characteristics of board members is an important topic, yet under-researched. This article aims to reveal whether a firm’s R&D investment is related to the directors’ postgraduate education experience. Further, we want to explore whether this relationship shows heterogeneity in different industrial environments. We analyzed information from a sample of 1374 listed companies in China using descriptive statistics, ordinary least square (OLS) regression and instrumental variable (IV) estimation, and came to the following conclusions: First, the percentage of directors with doctorates significantly increases the chance of investing R&D activities. Second, in the second industry, the higher the proportion of postgraduate education degree holder as directors in a firm, the more expenditure the firm invests in R&D activities. Yet, there is no such association in the third industry. Finally, if a capital-driven strategy is adopted, directors with a master’s degree tend to reduce R&D investment in IT companies. Findings from this research not only enrich innovation management theory, upper echelon theory, and human capital theory, but also provide insights for corporate governance and national sustainable innovation.

Effect of Board Diversity on Financial Performance of the Vietnamese Listed Firms

This study investigated the impact of board diversity on the financial performance of listed firms on the Vietnamese stock exchange. Four demographic characteristics of board members (gender, nationality, level of education and level of age) were used as the proxies for diversity. The data were analyzed by different methods including Pooled OLS regression, Fixed Effect Model (FEM), Random Effect Model (REM) and Generalized Method of Moments (GMM) using a sample of 482 companies listed in the period from 2015 to 2017. The results showed that the percentages of female members, foreign members and members with post-graduate degrees on the board, were statistically associated with improvement in financial performance. However, there was no evidence that the percentage of members under 45 years old on the board affected the performance of listed firms on the Vietnamese stock exchange.

The individual characteristics of board members and internal control weakness: Evidence from China

This study examines the relationships between the individual characteristics of board members and internal control weaknesses using data from Chinese listed firms from 2007 to 2015. The results indicate that the individual characteristics of board members including education, experience, certification, integrity and training are related to internal control deficiencies. The results also show that the individual characteristics of board chairmen are related to internal control problems. The overall results demonstrate that internal control quality is better, internal control weaknesses are reduced and weakness remediation is more likely to be applied in firms in which board members and board chairpersons have stronger qualifications. Furthermore, ownership has a moderating impact on the relationship between board characteristics and internal control. However, board behavior does not mediate the relationship between board members and internal control. Thus, it is suggested that board characteristics and internal control are directly linked. It is useful for directors to know that the characteristics of board members do make a difference.

Board Composition and Bank Risk Taking: Empirical Evidence from the Vietnamese Banking Sector

Although risk management in banking sector has attracted tremendous concern of both academics and practitioners, surprisingly little attention was paid on the relationship between demographic characteristics of board members and banks’ risk-taking behavior, especially in developing countries. Exploiting the dataset of Vietnamese banks from 2009 to 2016, we found that the introduction of female or foreign board members is likely to reduce banks’ risk taking. However, increasing the percentage of female or foreign board members has no marginal effect on the risk-taking behavior of banks which already had such board members. Further, board age has a positive relationship but board size shows a negative one with banks’ risk taking. Additionally, bank size and foreign ownership are found to be important determinants of banks’ risk-taking behavior in the context of Vietnam, i.e. banks with lower proportion of foreign ownership and larger banks tend to involve in more risky activities.

Predicting tax avoidance by means of social network analytics

This study predicts tax avoidance by means of social network analytics. We extend previous literature by being the first to build a predictive model including a larger variation of network features. We construct a network of firms connected through shared board membership. Then, we apply three analytical techniques, logistic regression, decision trees, and random forests; to create five models using either firm characteristics, network characteristics or different combinations of both. A random forest including firm characteristics, network characteristics of firms and network characteristics of board members provides the best performance with a minimal increase of 7 pp in AUC. Hence, including network effects significantly improves the predictive ability of tax avoidance models, implying that board members exhibit specific knowledge which can carry over across firms. We find that having board members with no connections to low-tax companies lowers the likelihood of being a low-tax firm. Similarly, the higher the average tax rate of the companies a board member is connected to, the lower the chance of being low-tax. On the other hand, being connected to more low-tax firms increases the probability of being low-tax. Consistent with prior literature on firm-specific variables, PP&E has a positive influence on the probability of being low-tax, while EBITDA has a negative effect. Our results are informative for companies as to the director expertise they want to attract in their boards. Additionally, financial analysts and regulatory agencies can use our insights to predict which firms are likely to be low-tax and potentially at risk.

Corporate governance and firm risk

PurposeThis study aims to explore the relationship between board governance structure and firm risk. In particular, this study develops a “governance index” based on four aspects of the board: board composition, board leadership structure, board member characteristics and board processes, and it examines how the overall index relates to firm risk.Design/methodology/approachThe study is conducted using a sample of 268 UK firms from the FTSE 350 index over the period from 2005 to 2010. An index is constructed to capture the overall governance structure of the firm. Regressions of the index on three risk measures are examined.FindingsThis study finds that the governance index that aggregates the four sets of board attributes is significantly and negatively related to firm risk. Robustness tests confirm this result.Research limitations/implicationsA large number of studies have explored the relationship between the attributes of corporate boards and firm performance with mixed results. A much smaller number of studies have looked at board attributes and firm risk, but these have either focused on financial sector firms alone or have included only a single or a limited number of attributes. This study, using a broad agency framework, seeks to extend the work on firm risk and board attributes by both expanding industry sectors examined and using a comprehensive set of board attributes.Originality valueThe findings have policy and practical implications for investors, regulators and chairmen of boards of governors to the extent that they inform these constituencies about the set of board attributes that are associated with firm risk. This study is the first to use a comprehensive measure of governance and relate it to firm risk.

Has the Push for Equal Gender Representation Changed the Role of Women on German Supervisory Boards?

In Germany, an intensive public debate about increasing female participation in leadership positions started in 2009 and proceeded until the beginning of 2015, when the German parliament enacted a board gender quota. In that period, the share of women on supervisory boards for 111 German publicly listed and fully codetermined companies (i.e. those which are affected by the quota law) more than doubled from 10.6 percent in 2009 to 22.6 percent in 2015. In 2016, the first year when the law was effective, the female share increased again by 4.5 percentage points. Using a hand-collected dataset, we investigate whether the rise in female board representation was accompanied by a change in gender differences in board member characteristics and board involvement. We do not find evidence for the “Golden Skirts” phenomenon, i.e., the rise in the female share was not achieved via a few female directors holding multiple board memberships. After controlling for firm heterogeneity, the remuneration of female shareholder (employee) representatives is about 16 (9) percent lower than for males. We interpret this as an overall indication that women are not only underrepresented in German supervisory boards, they are even more underrepresented in important board positions. Indeed, women are less likely to become a chairman and are less often assigned to board committees (except for the nominating committee). Moreover, in 2016 the disadvantage of women (as compared to men) to obtain a committee membership is even larger than in 2009.