country in the Union below) of FBMs “Innovation Scoreboard”; see Section “Innovativeness” is indicative of the technological distance between them. This is in line with earlier studies which have discussed the group effectiveness/diversity theory: these earlier studies have addressed how a more diversified board of directors will lead to a broader set of ideas, skills and perspectives (van Veen 2014), but that diversified boards (in this case: distance in et al., terms of technological expertise) face higher transaction costs in terms of e.g. increased risk of conflict, communication problems and the longer times required for consensus building (Goodstein 1994; van der Walt 2006; Piekkari 2015). Therefore, lastly we et al., et al., et al., hypothesize that: Hypothesis 3. Firms with FBMs from countries with relatively similar innovative capabilities are more innovative than firms with FBMs from countries with significantly lower or higher innovative capabilities. These issues are also related to firm size: board diversity increases with firm size, but at decreasing rates (Arnegger 2014). Moreover, there is considerable literature which et al., discusses the relationship between size and the innovativeness of firms (Kleinknecht, 1989; Dolfsma and van der Velde, 2014). Therefore, since both themes which are studied here, that is board diversity and firm innovativeness, are strongly related to firm size (Zona 2013), et al., the analyses will be performed separately with aggregate level data and with data divided into different firm size classes.
country in the “Innovation Union Scoreboard”; see Section “Innovativeness” below) of FBMs is indicative of the technological distance between them. This is in line with earlier studies which have discussed the group effectiveness/diversity theory: these earlier studies have addressed how a more diversified board of directors will lead to a broader set of ideas, skills and perspectives (van Veen et al., 2014), but that diversified boards (in this case: distance in terms of technological expertise) face higher transaction costs in terms of e.g. increased risk of conflict, communication problems and the longer times required for consensus building (Goodstein et al., 1994; van der Walt et al., 2006; Piekkari et al., 2015). Therefore, lastly we hypothesize that: Hypothesis 3. Firms with FBMs from countries with relatively similar innovative capabilities are more innovative than firms with FBMs from countries with significantly lower or higher innovative capabilities. These issues are also related to firm size: board diversity increases with firm size, but at decreasing rates (Arnegger et al., 2014). Moreover, there is considerable literature which discusses the relationship between size and the innovativeness of firms (Kleinknecht, 1989; Dolfsma and van der Velde, 2014). Therefore, since both themes which are studied here, that is board diversity and firm innovativeness, are strongly related to firm size (Zona et al., 2013), the analyses will be performed separately with aggregate level data and with data divided into different firm size classes.
Foreign%20board%20members%20and%20firm%20innovativeness.docx