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Board independence and firm internationalization: a meta-analysis

Ettore Spadafora (Saunders College of Business, Rochester Institute of Technology, Rochester, New York, USA)
Kwabena Aboah Addo (Faculty of Law, Economics and Governance, Utrecht University, Utrecht, The Netherlands)
Tatiana Kostova (Darla Moore School of Business, University of South Carolina, Columbia, South Carolina, USA)
Makafui Kwame Kumodzie-Dussey (University of Sussex Business School, University of Sussex, Brighton, UK)
Ezekiel Leo (Saunders College of Business, Rochester Institute of Technology, Rochester, New York, USA)
Valentina Marano (D’Amore-McKim School of Business, Northeastern University, Boston, Massachusetts, USA)
Marc van Essen (Darla Moore School of Business, University of South Carolina, Columbia, South Carolina, USA)

Multinational Business Review

ISSN: 1525-383X

Article publication date: 15 July 2022

Issue publication date: 27 October 2022

537

Abstract

Purpose

Despite agency theory and resource dependence theory suggesting that – albeit through different mechanisms – board independence positively influences firm internationalization, empirical evidence on this relationship has been mixed and inconclusive. Based on this, the purpose of the present study is twofold: first, to analyze and synthesize the existing empirical literature and, second, to develop new theoretical insights on the effect of board independence on firm internationalization.

Design/methodology/approach

The authors used advanced meta-analytic techniques that allowed them, first, to synthesize the existing empirical literature on the board independence–firm internationalization relationship and, second, to examine the effect of several contingencies on such relationship. This study relies on data from 87 primary studies (published and unpublished) carried out in multiple academic fields in the period 1998–2021 and covering 49 countries.

Findings

The results confirm the established agency and resource-dependence arguments, suggesting that higher board independence is associated with greater firm internationalization. Moreover, the results show that the focal relationship is moderated by home-country formal and informal institutional factors, and in particular, the legal protection of minority shareholders and family business legitimacy. The authors do not find evidence that CEO duality and board size moderate the focal relationship or that board independence has a stronger effect on breadth than on depth of internationalization.

Originality/value

This study lies at the intersection of the literatures on corporate governance and firm internationalization and on comparative corporate governance of the multinational firm, shedding further light on the role played by institutional environments in determining the effectiveness of corporate governance mechanisms.

Keywords

Acknowledgements

The authors would like to thank Editor-in-Chief Chang Hoon Oh for his editorial guidance throughout the review process. The authors also thank the anonymous reviewers for their insightful and constructive comments.

Citation

Spadafora, E., Addo, K.A., Kostova, T., Kumodzie-Dussey, M.K., Leo, E., Marano, V. and van Essen, M. (2022), "Board independence and firm internationalization: a meta-analysis", Multinational Business Review, Vol. 30 No. 4, pp. 499-525. https://doi.org/10.1108/MBR-04-2021-0055

Publisher

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Emerald Publishing Limited

Copyright © 2022, Emerald Publishing Limited

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