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/lp/emerald-publishing/board-composition-and-subsidiary-risk-an-explanatory-study-uCF1Ut0FuL
- Publisher
- Emerald Publishing
- Copyright
- Copyright © Emerald Group Publishing Limited
- ISSN
- 1536-5433
- DOI
- 10.1108/MRJIAM-08-2015-0606
- Publisher site
- See Article on Publisher Site
Abstract
PurposeTo explore the association between firm subsidiary risk and the board composition attributes of international experience, government experience and independence (outsiders) Design/methodology/approachWe sample the directors of the 104 largest European and United States service and industrial firms by market capitalization as listed in the Financial Times (FT) Global index of 2008 using a cross sectional design with data from 2009-11.FindingsInternational experience increases and government experience decreases firm subsidiary riskResearch limitations/implicationsOur subsidiary data is limited to the number of subsidiaries per country and not to other potentially valuable information like size, number of employees or even board composition at the subsidiary levels. Additionally, the use of a diversified US and European firm could add unnecessary variance due to different contexts involved in 104 firms.Practical implicationsThe desired level of firm subsidiary risk could be influenced by modifying the profile of board members.Originality/valueThis is one of the first studies to analyze the influence of board composition and risk at the firm level. Risk is a variable closely associated to internationalization.
Journal
Management Research: The Journal of the Iberoamerican Academy of Management – Emerald Publishing
Published: Jun 20, 2016