Board composition and firm reputationthe role of business experts, support specialists and community influentials

  1. Emma García-Meca 1
  2. Carlos J. Palacio 1
  1. 1 Universidad Politécnica de Cartagena
    info

    Universidad Politécnica de Cartagena

    Cartagena, España

    ROR https://ror.org/02k5kx966

Revista:
Business Research Quarterly

ISSN: 2340-9444,  2340-9436

Año de publicación: 2018

Volumen: 21

Número: 2

Páginas: 111-123

Tipo: Artículo

DOI: 10.1016/J.BRQ.2018.01.003 DIALNET GOOGLE SCHOLAR lock_openAcceso abierto editor

Otras publicaciones en: Business Research Quarterly

Resumen

El objetivo de este documento es analizar la influencia de la diversidad de recursos de la junta en la reputación de la empresa. Clasificamos a los miembros de la junta como expertos en negocios, especialistas en apoyo, directores políticos y otras personas influyentes de la comunidad, en un esfuerzo por abordar si los negocios, la experiencia técnica o los vínculos políticos en la sala de juntas afectan la opinión de las partes interesadas y, por lo tanto, la reputación de la empresa. Este estudio confirma que no todos los directores externos son igualmente efectivos para mejorar la reputación de la empresa, y que ciertos tipos de directores externos, especialmente los expertos en negocios, ayudan a aumentarla. Sin embargo, los hallazgos señalan una relación no lineal en forma de U invertida con estos directores, lo que significa que el efecto de los expertos en negocios sobre la reputación es positivo hasta cierto punto, después del cual la relación se vuelve negativa. Los hallazgos también evidencian que, contrariamente a las creencias populares, los directores con experiencia previa como políticos no son vistos negativamente por las partes interesadas. Además, este tipo de directores influyentes de la comunidad tiene efectos positivos en la reputación de la empresa tanto en las empresas reguladas como en las del sector de obra pública.

€ Ver financiación

Información de financiación

Emma García-Meca acknowledges the financial support of the Spanish Ministry of Economy (Research Project ECO 2017-82259-R). We also thank the Research Agency of the Spanish Government for financial support (Project ECO2017-82259-R).

Financiadores

Referencias bibliográficas

  • Badolato, P.G., Donelson, D.C., Ege, M., Audit committee financial expertise and earnings management: the role of status. J. Account. Econ. 58:2–3 (2014), 208–230, 10.1016/j.jacceco.2014.08.006.
  • Baysinger, B.D., Zardkoohi, A., Technology, residual claimants, and corporate control. J. Law Econ. Organ. 2:2 (1986), 339–349.
  • Bear, S., Rahman, N., Post, C., The impact of board diversity and gender composition on corporate social responsibility and firm reputation. J. Bus. Ethics 97:2 (2010), 207–221, 10.1007/s10551-010-0505-2.
  • Bona-Sánchez, C., Pérez-Alemán, J., Santana-Martín, D.J., Politically connected firms and earnings informativeness in the controlling versus minority shareholders context: European evidence. Corp. Gov. (Oxf.) 22:4 (2014), 330–346, 10.1111/corg.12064.
  • Bona Sanchez, C., Perez Aleman, J., Santana Martin, D.J., Politically connected firms and earnings informativeness in the controlling versus minority shareholders context: European evidence. Corp. Gov. (Oxf.) 22:4 (2014), 330–346, 10.1111/corg.12064.
  • Boubakri, N., Cosset, J., Saffar, W., Political connections of newly privatized firms. J. Corp. Finance 14 (2008), 654–673.
  • Brammer, S., Millington, A., Corporate reputation and philanthropy: an empirical analysis. J. Bus. Ethics 61:1 (2005), 29–44, 10.1007/s10551-005-7443-4.
  • Brammer, S., Millington, A., Pavelin, S., Corporate reputation and women on the board. Br. J. Manag. 20:1 (2009), 17–29, 10.1111/j.1467-8551.2008.00600.x.
  • Brammer, S., Pavelin, S., Corporate reputation adn social performance: the importance of fit. J. Manag. Stud. 43:3 (2006), 435–456.
  • Chaney, P.K., Faccio, M., Parsley, D., Chaney, P., Parsley, D., The quality of accounting information in politically connected firms connected firms. J. Account. Econ. 51 (2011), 58–76.
  • Chen, S., Sun, Z., Tang, S., Wu, D., Government intervention and investment efficiency: evidence from China. J. Corp. Finance 17:2 (2011), 259–271, 10.1016/j.jcorpfin.2010.08.004.
  • Claessens, S., Feijen, E., Laeven, L., Political connections and preferential access to finance: the role of campaign contributions. J. Financ. Econ. 88:3 (2008), 554–580, 10.1016/j.jfineco.2006.11.003.
  • Dass, N., Kini, O., Nanda, V., Onal, B., Wang, J., Board expertise: do directors from related industries help bridge the information gap?. Rev. Financ. Stud. 27:5 (2014), 1533–1592, 10.1093/rfs/hht071.
  • Defond, M.L., Hann, R.N., Xuesong, H.U., Engel, E., Does the market value financial expertise on audit committees of boards of directors?. J. Account. Res. 43:2 (2005), 153–204, 10.1111/j.1475-679x.2005.00166.x.
  • Delgado-García, J.B., De Quevedo-Puente, E., De La Fuente-Sabaté, J.M., The impact of ownership structure on corporate reputation: evidence from Spain. Corp. Gov. 18:6 (2010), 540–556, 10.1111/j.1467-8683.2010.00818.x.
  • Delgado-García, J.B., de Quevedo-Puente, E., Díez-Esteban, J.M., The impact of corporate reputation on firm risk: a panel data analysis of spanish quoted firms. Br. J. Manag. 24:1 (2013), 1–20, 10.1111/j.1467-8551.2011.00782.x.
  • Deutsch, Y., Ross, T.W., Directors as a signaling mechanism for young firms you are known by the directors you keep: reputable directors as a signaling mechanism for young firms. Manag. Sci.(49), 2003, 1003–1017.
  • Dhaliwal, D., Naiker, V., Navissi, F., The association between accruals quality and the characteristics of accounting experts and mix of expertise on audit committees. Contemp. Account. Res. 27:3 (2010), 787–827, 10.1111/j.1911-3846.2010.01027.x.
  • Drobetz, W., Meyerinck, F. Von, Oesch, D., Schmid, M., Board industry experience, firm value, and investment behavior. Working Paper (7–12). 2014, Hamburg Financial Research Center, 1–55.
  • Erhardt, N.L., Werbel, J.D., Shrader, C.B., Board of director diversity and firm financial performance. Corp. Gov. 11:2 (2003), 102–111, 10.1111/1467-8683.00011.
  • European Commission, The EU corporate governance framework. Green Report. 2011.
  • Faccio, M., Parsley, D., Sudden deaths: taking stocks of political connections. Discuss. Pap. Ser. 44:192 (2009), 0–28.
  • Faleye, O., Hoitash, R., Hoitash, U., Industry expertise on corporate boards. Northeastern U. D'Amore-McKim School of Business Research Paper. 2014, 10.2139/ssrn.2117104.
  • Fernández Sánchez, J.L., Sotorrío Luna, L., The creation of value through corporate reputation. J. Bus. Ethics 76:3 (2007), 335–346, 10.1007/s10551-006-9285-0.
  • Fich, E.M., Are some outside directors better than others? Evidence from director appointments by fortune 1000 firms. J. Bus. 78:5 (2005), 1943–1972, 10.1086/431448.
  • Fombrun, C., Shanley, M., What's in a name? Reputation building and corporate strategy. Acad. Manag. J. 33 (1990), 233–258.
  • Fombrun, C.J., Gardberg, N.A., Sever, J.M., The Reputation QuotientSM: a multi-stakeholder measure of corporate reputation. J. Brand Manag. 7:4 (2000), 241–255, 10.1057/bm.2000.10.
  • Francis, B., Hasan, I., Wu, Q., Professors in the boardroom and their impact on corporate governance and firm performance. Financ. Manag., 2015, 547–581.
  • Gabbioneta, C., Ravasi, D., Mazzola, P., Exploring the drivers of corporate reputation: a study of Italian securities analysts. Corp. Reput. Rev. 10:2 (2007), 99–123.
  • García-Meca, E., Political connections, gender diversity and compensation policy. Rev. Manag. Sci., 2016, 10.1007/s11846-015-0167-7.
  • García-Meca, E., García-Sánchez, I.-M., Martínez-Ferrero, J., Board diversity and its effects on bank performance: an international analysis. J. Bank. Finance 53 (2015), 202–214, 10.1016/j.jbankfin.2014.12.002.
  • García-Meca, E., López-Iturriaga, F., Tejerina-Gaite, F., Investors on boards: do they influence corporate finance?. J. Bus. Ethics(November), 2015, 1–43, 10.1007/s10551-015-2882-z.
  • Goldman, E., Rocholl, J., So, J., Do politically connected boards affect firm value?. Rev. Financ. Stud. 22:6 (2009), 2331–2360, 10.1093/rfs/hhn088.
  • Good Governance Code of Spanish Listed Companies, Comisión Nacional del Mercado de Valores. 2015 Madrid.
  • Gray, S., Nowland, J., Professional expertise and board diversity. Working Paper. July 2014, 1–49.
  • Harrison, D.A., Klein, K.J., Whats the difference? Diversity construct as separation, variety or disparity in organizations. Acad. Manag. Rev. 32:4 (2007), 1199–1228.
  • Haynes, K.T., Hillman, A., The effect of board capital and CEO power on strategic change. Strateg. Manag. J. 31:11 (2010), 1145–1163, 10.1002/smj.859.
  • Hillman, A., Politicians on the board of directors: do connections affect the bottom line?. J. Manag. 31:3 (2005), 464–481, 10.1177/0149206304272187.
  • Hillman, A., Cannella, J., Paetzold, R., The resource dependence role of corporate directors: strategic adaptation of board composition in response to environmental change. J. Manag. 37:March (2000), 235–256, 10.1111/1467-6486.00179.
  • Iturriaga, F.J.L., Rodríguez, I.M., Boards of directors and firm performance: the effect of multiple directorships. Span. J. Finance Account. 43:2 (2017), 177–192, 10.1080/02102412.2014.913909.
  • Jones, C.D., Makri, M., Gomez-Mejia, L.R., Affiliate directors and perceived risk bearing in publicly traded, family-controlled firms: the case of diversification. Entrep. Theory Pract.(480), 2008, 359–385, 10.1111/j.1540-6520.2011.00472.x.
  • Kang, H., Cheng, M., Gray, S.J., Corporate governance and board composition: diversity and independence of Australian boards. Corp. Gov. 15:2 (2007), 194–207, 10.1111/j.1467-8683.2007.00554.x.
  • Kim, K., Mauldin, E., Patro, S., Outside directors and board advising and monitoring performance. J. Account. Econ. 57:2–3 (2014), 110–131, 10.1016/j.jacceco.2014.02.001.
  • Krishnan, G.V., Visvanathan, G., Does the SOX definition of an accounting expert matter? The association between audit committee directors’ accounting expertise and accounting conservatism. Contemp. Account. Res., 25, 2008, 10.1017/CBO9781107415324.004.
  • Kroll, M., Walters, B., Le, S., The impact of board composition and top management team ownership structure on post-IPO performance in young entrepreneurial firms. Acad. Manag. J. 50:5 (2007), 1198–1216, 10.2307/20159920.
  • Litov, L.P., Sepe, S.M., Whitehead, C.K., Lawyers and fools: lawyer–directors in public corporations. Georget. Law J. 102:2 (2014), 413–480.
  • Markarian, G., Parbonetti, A., Firm complexity and board of director composition. Corp. Gov. 15:6 (2007), 1224–1243, 10.1111/j.1467-8683.2007.00643.x.
  • Musteen, M., Datta, D.K., Kemmerer, B., Corporate reputation: do board characteristics matter?. Br. J. Manag. 21:2 (2010), 498–510, 10.1111/j.1467-8551.2009.00676.x.
  • Pfeffer, J., Salancik, G.R., The external control of organizations. 1978, Harper & Row, New York.
  • Roberts, P.W., Dowling, G.R., Corporate reputation and superior financial performance. Strateg. Manag. J. 1093:September (2002), 1077–1093, 10.1002/smj.274.
  • van der Walt, N., Ingley, C., Board dynamics and the influence of professional background, gender and ethnic diversity of directors. Corp. Gov. 11:3 (2003), 218–234, 10.1111/1467-8683.00320.
  • Wang, l., Hsiao, C., Two-stage estimation of limited dependent variable models with errors-in-variables. Econom. J. 10 (2007), 426–438.
  • You, J., Du, G., Are political connections a blessing or a curse? Evidence from CEO turnover in China. Corp. Gov. 20:2 (2012), 179–194, 10.1111/j.1467-8683.2011.00902.x.
  • Zahra, S.A., Pearce, J.A., Boards of directors and corporate financial performance: a review and integrative model. J. Manag., 15(2), 1989, 291.
Fuente de los datos: Dialnet