Section 4 describes the empirical analysis followed by discussions in section 5. Section 2 presents the relevant literature and research hypotheses. The rest of the paper is organized as follows. This research is particularly interesting as few studies have previously investigated this topic related to the impact of the board of directors on innovation activities, comparing the familiar nature of companies that strongly determine how the companies are managed and governed. Upon these objectives, we aim to contribute to a body of knowledge that is inconclusive by analyzing the impact of the aforementioned characteristics, board independence and CEO duality on innovation, providing empirical evidence and insights of firms in innovative sectors in Spain.
Second, this study seeks to investigate if such influence differs when comparing family and non-family businesses. First, it aims to contribute to the existing literature in determining how certain board of directors' characteristics, composition and leadership structure, can boost business innovation. Therefore, the objective of this study can be stated as twofold. The existing literature shows that studies exploring the relationship between corporate governance and innovation performance have yielded very mixed findings in terms of the board size, its gender diversity, and CEO's characteristics ( Berraies and Rejeb, 2019 Principe, 2016 Jaskyte, 2012 Wincent et al., 2010). However, very few research works are dedicated to the contribution of corporate governance to strategic resources development and innovation promotion ( O'Sullivan, 2000 Lazonick, 2010 Shapiro et al., 2015 Berraies and Rejeb, 2019). Some studies in the literature have focused on innovation determinants ( Drucker, 1985 Jansen et al., 2006 Berraies et al., 2015 Valenti and Horner., 2020 Iyengar and Sundararajan, 2019). Research work with regards to the relationship between different aspects of corporate governance and innovation were initiated since decades ago ( Goodstein and Boeker, 1991). This literature suggests that firms are different in corporate governance structure and mechanism and these differences may partially explain the innovative behavior adopted ( Barker and Mueller, 2002). Internally, corporate governance literature offers some useful insights into the innovative behavior of firms ( Belloc, 2012). There are both internal and external variables which may have an impact on firms' innovation process and strategy ( Cassiman and Veugelers, 2006). Innovation becomes a crucial tool not only for firms to develop and maintain the competitive advantages in the ongoing turbulent market ( Becheikh et al., 2006 Gonzales-Bustos et al., 2017) but also a key for their success and survival ( Kor, 2006 Torchia et al., 2011).
These findings contribute to an inconclusive literature regarding board effects on innovation, highlighting different recommendations depending on whether the companies are family businesses or not. Finally, obtained results support that independent directors have a negative impact on innovation and such negative influence is even stronger in family firms.
Similarly, findings also point out that duality is better than the independence of functions in the case of non-family businesses. The results show that innovation is affected positively by board size, especially in the case of family businesses, and gender diversity, especially in non-family businesses. Data were collected from 86 Spanish companies of innovative sectors from 2003 to 2014. Also, this study seeks to investigate if such influence differs when comparing family and non-family business. This paper contributes to the corporate governance and innovation literature by providing empirical evidence with respect to the influence of composition of the board and its leadership structure on innovation.
0 kommentar(er)
