Abstract

http://ssrn.com/abstract=1875710
 
 

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Directors’ Human Capital, Firm Strategy, and Firm Performance


Pascal A. Gantenbein


University of Basel

Christophe Volonté


University of Basel

December 23, 2014

Journal of Management and Governance, DOI:10.1007/s10997-014-9304-y, Forthcoming

Abstract:     
Ideally, corporations are directed by boards whose directors provide valuable human capital that match the firms’ strategy. We investigate how directors’ human capital (international experience, industrial know-how, CEO experience, and financial know-how) affects firm performance including the firm’s strategy (diversification and internationalization) and how human capital is related to acquisition strategies (non-diversifying and international acquisitions). Our sample consists of 560 firm-year observations in Switzerland. We find empirical evidence that directors’ human capital affects firm performance and that this relationship depends on the firm’s strategy. Furthermore, human capital is also correlated with acquisition strategy. The study shows that focusing on board independence and compliance issues may be unrewarding in board research and practice.

Number of Pages in PDF File: 46

Keywords: corporate governance; board of directors; resource dependence theory (RDT); agency theory; human capital; firm performance

JEL Classification: G30, G34, G38

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Date posted: July 1, 2011 ; Last revised: December 23, 2014

Suggested Citation

Gantenbein, Pascal A. and Volonté, Christophe, Directors’ Human Capital, Firm Strategy, and Firm Performance (December 23, 2014). Journal of Management and Governance, DOI:10.1007/s10997-014-9304-y, Forthcoming. Available at SSRN: http://ssrn.com/abstract=1875710 or http://dx.doi.org/10.2139/ssrn.1875710

Contact Information

Pascal A. Gantenbein
University of Basel ( email )
Petersplatz 1
Basel, CH-4003
Switzerland
HOME PAGE: http://wwz.unibas.ch/abteilungen/home/abteilung/fmgt/
Christophe Volonté (Contact Author)
University of Basel ( email )
Peter Merian-Weg 6
Basel, CH-4002
Switzerland
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References:  28

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