Encyclopedia of Sustainable Management

Living Edition
| Editors: Samuel Idowu, René Schmidpeter, Nicholas Capaldi, Liangrong Zu, Mara Del Baldo, Rute Abreu

Board Capital

  • Fabrizia SartoEmail author
Living reference work entry
DOI: https://doi.org/10.1007/978-3-030-02006-4_881-1
  • 27 Downloads

Synonyms

Definition

The “Board Capital” is the combination of human and social/relational capital of board members (Hillman and Dalziel 2003). More specifically, scholars define the Board Capital as the sum of knowledge and skills that directors hold thanks to their educational path and work experiences and the set of relationships established by directors with internal and external stakeholders.

Introduction

Characteristics of board members that influence firm performance have increasingly been of interest of scholars and practitioners (Daily et al. 2003; Gupte and Paranjape 2014; Agrawal and Chadha 2005). In this regard, a relevant issue in the academic and practical debates has been to answer the question of what enhances directors’ effectiveness in value maximization. Despite there has always been a tacit consensus that individual director characteristics and qualifications are relevant aspects (Jensen 1993), most of studies have mainly focused on broad board attributes such as board size, composition (e.g., independence), appointment methods, structure, equity ownership, and diversity (i.e., gender and ethnicity) (Johnson et al. 2012).

However, against the main stream examining the surface properties of the board of directors, a number of articles have recently explored the determinants of board functioning by focusing on its relational and human capital (Berezinets et al. 2016). Board capital is the sum of human and social/relational capital of board members (Hillman and Dalziel 2003). More specifically, scholars define the board human capital as the expertise, experience, knowledge, and skills that board members possess thanks to their education and work experiences, ranging from the high educational level to the expertise in a specific sector. Differently, scholars identify the board relational (or social) capital in the relationships established by board members with internal and external stakeholders.

Hillman and Dalziel (2003) have been the pioneers of the board capital construct. The authors have claimed that directors contribute to the board through their expertise, experience, and skills, as well as social links and networks. In this regards, scholars have argued that the effectiveness of board functioning relies on the intellectual capital of board members, that is able to overcome the inconclusiveness of the empirical evidence examining the relationship between the surface properties of the board of directors and firm performance until then. Indeed, according to the authors (Hillman and Dalziel 2003), this construct would have allowed to overcome the weakness of choosing one theoretical approach over another on the board (Nicholson and Kiel 2004) and the inability of typical board composition/structure measures to predict its effectiveness (Dalton et al. 1998; Hillman et al. 2000). Differently, board capital represents the preconditions of the board’s ability to engage in all governance activities, such as monitoring or resource provision roles, by explaining and arguing all the theories concerning the board governaning role (e.g., agency theory, resource dependence theory) (Kor and Sundaramurthy 2008; Nicholson and Kiel 2004).

To appreciate how the board capital concept has been able to overcome the limits of the traditional board demographic approach, it seems crucial to understand the process that led scholars to develop it. In particular, it is worth noting that the formulation of the above-mentioned concept takes place thanks to two main contributions (Zona 2013; Berezinets et al. 2016). Within a first paper of 2000, Hillman, Cannella, and Paetzold argue that the traditional board members classification according their independence status allows to proxy for the antecedents of board monitoring function but not for the service role. In their paper, the authors claim that it is possible to overcome this limit by using alternative classifications, for example by measuring if board members have work experiences in comparable firm, or an educational degree in a specific area (e.g., law, banking, commercial). Therefore, the authors develop the belief that building on the “resource dependency theory” perspective, the effectiveness of board directors in providing resources to the company relies on their social and human capital.

As a further step in the development of the Board capital construct, 3 years later, Hillman and Dalziel (2003) publish a seminal paper on the Academy of Management Journal and refer for the first time to the human capital theory and to the social capital theory. More specifically, they argue that board members' capital is able to allow the governing body to perform not only the service role, but also the monitoring one. Indeed, the researchers assert that the directors’ independence does not proxy for the members’ ability to monitor but for their incentive to do so. This incentive can moderate the board’s ability which in turn only depends on the members’ relational and human capital.

In this perspective, the literature highlights that the human and social capital is the best proxy to appreciate the board’s ability to perform its functions. It is worth noting that the concept of the human and social/relational capital, and the related measures represent the only ones that allow to explain and argue all theories related to the governing roles of the board (Nicholson and Kiel 2004). The intellectual capital held by the governing body thus represents the precondition of the board’s ability to carry out all its activities. Scholars argue that the board’s ability to carry out all roles relies on the resources that directors provide to the board (Berezinets et al. 2016; Sarto 2016).

The advantage of employing this approach is twofold. Indeed, on the one hand, as previously stated, it allows to grasp the ability of the governing body to fulfill all its roles and activities, from the monitoring role to the provision one, overcoming therefore the competition between the different theoretical approaches. On the other hand, it also allows to look at the board as a collegial body, representing a proxy to appreciate some of the processes defined by Forbes and Milliken (1999), such as the presence of cognitive conflicts or the use of the knowledge and skills available in the board (Sarto 2019).

Aside the theoretical contributions that have developed the Board capital construct, it is also relevant to mention those studies that have identified the dimensions that characterize the board capital. In this regards, Haynes and Hillman (2010) conceptually identify the “breadth” and “depth” as two dimensions of board capital. While the former captures the human and relational capital heterogeneity of board members, the latter refers to the embeddedness of the board in the focal firm’s industry. Some authors have enlarged the dimensions of board capital by identifying also its quality, in terms of educational level, as well as professional prestige. Moreover, additional scholars have enlightened the board capital complementarity, that concerns the level of complementarity between the directors’ background and the firm activities (Zona 2013; Sarto et al. 2020).

The Board Human Capital

Focusing the attention on the human capital element of the board capital, it is worth noting that the idea of human capital finds its origin in 1960s when the economists Schultz (1961) and Becker (1962) defined and formalized the Human Capital Theory. Indeed, over the early 1960s, scholars of economic growth found out a number of difficulties in explaining the boost of US economy in terms of traditional tangible factors of production (Krueger 1968). Indeed, researchers used to neglect “the residual” factors that instead were crucial determinants of the economic gap, that is, the human capital (Becker 1962; Schultz 1961; Weisbrod 1966). Differently, Schultz (1961) and Becker (1962) interpreted this gap through the lenses of the human capital theory. The base principle of the theory is that within an organization peoples’ learning capacities are valuable as well as the other resources that are employed in the production (Lucas 1988). In this sense, if these resources are empowered through investments and are effectively used, the results are profitable not only for the individual but also for the organization and the overall society (Becker 1962; Schultz 1961). Therefore, according to the human capital theory the human capital is a crucial determinant for the organizational outcomes. Building on this assumption, as previously stated, corporate governance literature has developed the concept of human capital as a part of the wider notion of board capital (Hillman et al. 2002).

Research investigating the board human capital provides a number of classifications (Gibbons and Waldman 2004; Lester et al. 2008). Most studies distinguish between general and specific human capital. While the former includes the overall expertise that is generally applied across settings, the latter considers the one that matters for a specific firm, industry, and function (Behrens et al. 2012; Ganotakis 2010; Kor and Sundaramurthy 2008; Marvel and Lumpkin 2007). In particular, studies on general human capital focus on the director education by examining the educational qualification awarded by prestigious universities and management schools or the educational degree (e.g., PhD and master degree) (Arena et al. 2015; Bond et al. 2010; Barroso et al. 2011). As for the specific human capital, research distinguishes among firm, industry/sector, and functional expertise (Ganotakis 2010).

As generally reported for the board capital, the human capital of board members determines the board ability to effectively execute both monitoring and resources provision roles (Hillman and Dalziel 2003).

Concerning the former, having firm and industry experience/expertise allows to better know the typical management job tasks and skills useful, for example, to perform the board’s duties of nominating top executives (Tian et al. 2011). Expertise in the firm or in the sector is also relevant for the management evaluation process as it fosters the better identification of appropriate activities as well as the estimation of changes to cope with future firm contexts and environments (Carpenter et al. 2001; Jensen and Meckling 1976). The assessment and the evaluation of managerial activities also benefits from the breadth of knowledge of board members. Indeed, the presence of heterogeneous board members, with a wide range of skills and expertise, allows to observe the problem from different points of view.

Concerning the second role, board human capital improves the provision of advice and counsel as well as legitimacy for firm operating activities (Hillman and Dalziel 2003).

Regarding the strategic process, literature reports that taking complex strategic decisions requires, in strict time constraints, managing information overload as well as effectively recognizing the long-term implications of the alternatives to consider (McDonald et al. 2008). In this sense, experts are generally better able to solve these troubles as they hold highly developed problem-solving skills and better knowledge of critical issues in the area where they are experts (Kor and Sundaramurthy 2008). Moreover, experiences in the same firm/industry allow them to better understand firm business, technology, human assets, and the specific setting conditions so as to overcome decision challenges (Kroll et al. 2008). Still concerning the strategic board process, the advice and counsel role of the board benefits from the presencecds (e.g., educational and functional) (Bunderson and Sutcliffe 2002; Forbes and Milliken 1999; Li and Hambrick 2005). Literature in this tradition reports that the board human capital heterogeneity improves the directors’ decision-making and results in positive corporate outcomes. Indeed, scholars suggest that the background diversity connected to the cognitive heterogeneity of board members stimulates the debate among directors and enhances the board problem-solving (Lester et al. 2008; Cho and Hambrick 2006). In addition, scholars claim that the board human capital heterogeneity increases the information available to board directors, fostering the proper appraisal of company opportunities with positive implications for their decision making activity (Brodbeck et al. 2007).

Turning the attention to the provision of legitimacy, directors with relevant expertise/experience like business founders (Kor and Sundaramurthy 2008), former government members and politicians (Hillman et al. 2000; Hillman 2005; Lester et al. 2008), or generally business/industry experts (Hillman et al. 2000; Kor and Misangyi 2008), increase the reputation of both board and organization (Certo 2003; Hillman and Dalziel 2003). Moreover, the board members’ educational qualification awarded by prestigious universities and management schools, or board educational level (in terms of PhD, master degree, or bachelor degree), improves the reputation of the board functioning (Arena et al. 2015; Bond et al. 2010; Barroso et al. 2011).

Empirical studies report supportive findings in this sense. As human capital enhances the effectiveness of governance roles, and as an effective governance function improves company output (Nicholson and Kiel 2004), this literature explores the relationship between industry expertise, firm expertise, functional background and heterogeneity, and the organizational outcomes.

More specifically, it is possible to highlight the existence of four main streams of research.

The first stream examines the implications of the quality of board human capital, in terms of level of expertise and experience. Studies in this tradition have investigated the implications of the educational level on the innovation (Wincent et al. 2010; Dalziel et al. 2011) and the internationalization (Barroso et al. 2011). Others have explored the effect of the educational level of board members on financial performance (Jermias and Gani 2014; Arena et al. 2015) and IPO value (Certo 2003; Sundaramurthy et al. 2014).

The second stream of research investigates the implications of having working experience in specific activities or specific functions (i.e., the functional expertise), as well as a training/education in a specific area. More specifically, some studies have reported the implications of board financial expertise for the debt level (Burak Güner et al. 2008), strategic choices (Jensen and Zajac 2004; Westphal and Fredrickson 2001), innovation (Dalziel et al. 2011), firm performance (Kim and Lim 2010; DeFond et al. 2005), and finally, accounting practices (Dhaliwal et al. 2010). Other studies have investigated the performance implications of having expertise in specific activities and contexts such as M&A operations (McDonald et al. 2008), strategic alliances (Chen and Lai 2017), internationalized organizations (Chen et al. 2016), and green setting (Cowden and Bendickson 2015).

The third research stream is composed by articles investigating the implications of board members expertise/experience consistent with the characteristics of the company in which they have been appointed. This is the case of industry and firm expertise. Concerning the former, several articles have explored the relationship between this measure of board human capital and firm outcomes such as the start-up success (Kor and Misangyi 2008), the outcome of M&A operations (Kroll et al. 2008), the firm growth (Kor and Sundaramurthy 2008), the earnings management (Wang et al. 2015), the level of internationalization (Barroso et al. 2011; Volonté and Gantenbein 2016), the market value (Tian et al. 2011), and the firm performance (Dass et al. 2014; Veronesi et al. 2013). Turning the attention to the firm expertise, a less copious group of papers have explored the positive implications of board members with previous experiences in the same firm. They mainly investigate firm outcomes in terms of growth (Kor and Sundaramurthy 2008), internationalization (Barroso et al. 2011), and market reaction (Fahlenbrach et al. 2010).

Finally, the fourth stream of research has explored the relationship between, on the one side, the board background heterogeneity and, on the other side, the financial outcomes (Antonelli et al. 2013; Wellalage and Locke 2013; Harris and Helfat 1997; Volonté and Gantenbein 2016; Vandenbroucke et al. 2016) and the corporate innovation (Midavaine et al. 2016; Van Knippenberg et al. 2011; Kim and Kim 2015; Bianchi et al. 2012; Sarto et al. 2020; Heyden et al. 2015).

The Board Social Capital

Shifting the attention to the other side of the coin, that is, the board social capital, literature defines it as the directors’ ability to extract future economic benefits from the resources that they obtain through the established relationships with external and internal stakeholders, at board and company level (Berezinets et al. 2016).

Previous studies have identified several board social capital classifications. However, the most widespread classification distinguishes the internal social capital from the external one. The first element includes director’s ties within the governing board, and refers to the relationships established among the same directors. Differently, the external capital includes the links established by board members with the external environment (inside and outside the firm), thanks to which they gain information, power, legitimacy, and other critical resources for the achievement of the firm competitive advantage (Pérez-Calero et al. 2016). In this regard, the board external social capital can be in turn divided into two sub-elements. On the one side, it refers to the relationships between board members and the manager/employees inside the firm. On the other side, it includes the links that directors create with stakeholders outside the company. Finally, it is worth noting that aside the internal and external board social capital, scholars suggest the existence of a borderline social capital element that can be considered either internal or external and that refers to the director’s social standing and reputation (Sarto 2019).

Focusing the attention on the external board social capital, and specifically on the established links with stakeholders outside the company, scholars distinguish the single-type bonds from double-type ones. In the first case, they represent relationships that a director directly establishes with another company. This phenomenon occurs when a non-executive director sits on the board of the “X” company and is fully employed in the “Y” company. Differently, double links occur when a board member of “X” company also sits on the board of the “Y” company and correspond to the interlocking directorship phenomenon (Johnson et al. 2012). In this regard, scholars suggest that there are a number of positive implications of the existence the above-mentioned links. Firstly, relationships allow the access to useful and timely information, fostering the information sharing. This is beneficial for board processes, and for the fulfillment of the advice and counsel role, especially with regard to the strategy formulation (Ferris et al. 2003), thus positively affecting company outcomes (Kor and Sundaramurthy 2008; Hoitash 2011; Jiraporn et al. 2008). From a different point of view, relationships with external stakeholders allow firm to access to crucial resources as well as to acquire them at more favorable conditions, with positive effects for business performance (Hillman 2005; Kor and Sundaramurthy 2008).

Still concerning the external capital, but focusing on the links among board members and manager/employees/owners of the same firm, scholars claim that these relationships can occur in three specific cases (Johnson et al. 2012). First of all, board members can be “affiliated,” as they have been appointed on the board due to previous working relationships with the firm, such as in the case of suppliers, consultants, or customers. Second, directors can be appointed on the governing body based upon a CEO’s request. Finally, there is the case of members with personal relationships with company managers, based on family or friendship links (Jones et al. 2008). Research on the topic suggest that personal and trust relationships can favor the information sharing between the board and the company, thus improving the board strategic process. Indeed, directors with friendship links are better able to express their doubts about corporate strategies (Westphal and Bednar 2005). From a different point of view, other studies document that “affiliated” directors as well as members with personal ties carries weight in the decision-making process and are more influential compared with their peers (Stevenson and Radin 2009).

Turning the attention to the internal social capital, studies show that the links among directors are consequences of their previous work experience within the same team. In this regard, the board functioning takes advantage from the co-working experience and this positively affects company performance (Tian et al. 2011). Indeed, board members develop tacit knowledge of the firm and its characteristics, and this is especially useful for independent members. In addition, thanks to the co-working experience, the team increases its ability of coordination and integration of various skills represented in the group.

Shifting the focus on the last dimension of the board social capital, literature has highlighted the crucial role played by the directors’ social status. Indeed, research suggests that the reputation and prestige of a board member act as a signal, by increasing the external legitimacy of the firm (Certo 2003). Indeed, it is able not only to increase the overall trust of external stakeholders toward the firm, but also to allow the company access to crucial resources.

Summary

This entry illustrates the main characteristics of Board capital. More specifically, it examines in depth both the human and social dimensions of board capital, by explaining their implications for the board of directors’ effectiveness and firm outcomes.

Cross-References

References

  1. Agrawal, A., & Chadha, S. (2005). Corporate governance and accounting scandals. The Journal of Law and Economics, 48(2), 371–406.CrossRefGoogle Scholar
  2. Antonelli, G., Rivieccio, G., & Moschera, L. (2013). Caratteristiche dei consigli di amministrazione e performance delle società quotate in borsa: un’analisi per cluster. In La retribuzione del top management: incentivi, carriera e governance (pp. 49–78). Milano: EGEA.Google Scholar
  3. Arena, C., Cirillo, A., Mussolino, D., Pulcinelli, I., Saggese, S., & Sarto, F. (2015). Women on board: Evidence from a masculine industry. Corporate Governance: The international journal of business in society, 15(3), 339–356.CrossRefGoogle Scholar
  4. Barroso, C., Villegas, M. M., & Pérez-Calero, L. (2011). Board influence on a firm’s internationalization. Corporate Governance, 19(4), 351–367.CrossRefGoogle Scholar
  5. Becker, G. (1962). Investment in human capital: a theoretical analysis. The Journal of Political Economy, 70(5), 9–49.CrossRefGoogle Scholar
  6. Behrens, J., Patzelt, H., Schweizer, L., & Bürger, R. (2012). Specific managerial human capital, firm age, and venture capital financing of biopharmaceutical ventures: A contingency approach. The Journal of High Technology Management Research, 23(2), 112–121. Elsevier B.V.CrossRefGoogle Scholar
  7. Berezinets, I., Garanina, T., & Ilina, Y. (2016). Intellectual capital of a board of directors and its elements: Introduction to the concepts. Journal of Intellectual Capital, 17(4), 632–653.CrossRefGoogle Scholar
  8. Bianchi, S., Corvino, A., & Rigolini, A. (2012). Board diversity and investments in innovation: Empirical evidence from Italian context. In International conference: Corporate governance & regulation: Outlining new horizons for theory and practice.Google Scholar
  9. Bond, M., Glouharova, S., & Harrigan, N. (2010). The political mobilization of corporate directors: Socio-economic correlates of affiliation to European pressure groups. The British Journal of Sociology, 61(2), 306–335.CrossRefGoogle Scholar
  10. Brodbeck, F. C., Kerschreiter, R., Mojzisch, A., & Schulz-Hardt, S. (2007). Group decision making under conditions of distributed knowledge: The information asymmetries model. Academy of Management Review, 32(2), 459–479.CrossRefGoogle Scholar
  11. Bunderson, J. S., & Sutcliffe, K. M. (2002). Comparing alternative conceptualizations of functional diversity in management teams: Process and performance effects. Academy of Management Journal, 45(5), 875–893.Google Scholar
  12. Burak Güner, A., Malmendier, U., & Tate, G. (2008). Financial expertise of directors. Journal of Financial Economics, 88(2), 323–354.CrossRefGoogle Scholar
  13. Carpenter, M. A., Sanders, G., & Gregersen, H. B. (2001). Bundling human capital with organizational context: The impact of international assignment experience on multinational firm. Academy of Management Journal, 44(3), 493–511.Google Scholar
  14. Certo, S. T. (2003). Influencing initial public offering investors with prestige: Signaling with board structures. Academy of Management Review, 28(3), 432–446.CrossRefGoogle Scholar
  15. Chen, L. Y., & Lai, J. H. (2017). The effect of board human capital on the performance of technical alliance investments. R&D Management, 47(2), 265–276.CrossRefGoogle Scholar
  16. Chen, H. L., Hsu, W. T., & Chang, C. Y. (2016). Independent directors’ human and social capital, firm internationalization and performance implications: An integrated agency-resource dependence view. International Business Review, 25(4), 859–871.CrossRefGoogle Scholar
  17. Cho, T. S., & Hambrick, D. C. (2006). Attention as the mediator between top management team characteristics and strategic change: The case of airline deregulation. Organization Science, 17(4), 453–469.CrossRefGoogle Scholar
  18. Cowden, B., & Bendickson, J. (2015). Experience-based green board capital: Linking Board of Directors and Firm Environmental Performance. Journal of Leadership, Accountability and Ethics, 12(3), 16–29.Google Scholar
  19. Daily, C. M., Dalton, D. R., & Cannella, A. A., Jr. (2003). Corporate governance: Decades of dialogue and data. Academy of Management Review, 28(3), 371–382.CrossRefGoogle Scholar
  20. Dalton, D. R., Daily, C. M., & Johnson, J. (1998). Meta-analytic reviews of board composition, leadership structure, and financial performance. Strategic Management Journal, 19(3), 269–290.CrossRefGoogle Scholar
  21. Dalziel, T., Gentry, R. J., & Bowerman, M. (2011). An integrated agency-resource dependence view of the influence of directors’ human and relational capital on firms’ R&D spending. Journal of Management Studies, 48(6), 1217–1242.CrossRefGoogle Scholar
  22. Dass, N., Kini, O., Nanda, V., Onal, B., & Wang, J. (2014). Board expertise: Do directors from related industries help bridge the information gap? Review of Financial Studies, 27(5), 1533–1592.CrossRefGoogle Scholar
  23. DeFond, M. L., Hann, R. N., & Hu, X. (2005). Does the market value financial expertise on audit committees of boards of directors? Journal of Accounting Research, 43(2), 153–193.CrossRefGoogle Scholar
  24. Dhaliwal, D. A. N., Naiker, V. I. C., & Navissi, F. (2010). The association between accruals quality and the characteristics of accounting experts and mix of expertise on audit committees. Contemporary Accounting Research, 27(3), 787–827.CrossRefGoogle Scholar
  25. Fahlenbrach, R., Low, A., & Stulz, R. M. (2010). Why do firms appoint CEOs as outside directors? Journal of Financial Economics, 97(1), 12–32.CrossRefGoogle Scholar
  26. Ferris, S. P., Jagannathan, M., & Pritchard, A. C. (2003). Too busy to mind the business? Monitoring by directors with multiple board appointments. The Journal of Finance, 58(3), 1087–1111.CrossRefGoogle Scholar
  27. Forbes, D. P., & Milliken, F. J. (1999). Cognition and corporate governance: Understanding boards of directors as strategic decision-making groups. Academy of Management Review, 24(3), 489–505.CrossRefGoogle Scholar
  28. Ganotakis, P. (2010). Founders’ human capital and the performance of UK new technology based firms. Small Business Economics, 39(2), 495–515.CrossRefGoogle Scholar
  29. Gibbons, R., & Waldman, M. (2004). Task-specific human capital. American Economic Review, 94(2), 203–207.CrossRefGoogle Scholar
  30. Gupte, A., & Paranjape, S. (2014). Performance Evaluation of Boards and Directors. Deloitte.Google Scholar
  31. Harris, D., & Helfat, C. E. (1997). Specificity of CEO human capital and compensation. Strategic Management Journal, 18, 895–920.CrossRefGoogle Scholar
  32. Haynes, K. T., & Hillman, A. (2010). The effect of board capital and CEO power on strategic change. Strategic Management Journal, 31, 1145–1163.CrossRefGoogle Scholar
  33. Heyden, M. L. M., Oehmichen, J., Nichting, S., & Volberda, H. W. (2015). Board background heterogeneity and exploration-exploitation: The role of the institutionally adopted board model. Global Strategy Journal, 5(2), 154–176.CrossRefGoogle Scholar
  34. Hillman, A. (2005). Politicians on the Board of Directors: Do connections affect the bottom line? Journal of Management, 31(3), 464–481.CrossRefGoogle Scholar
  35. Hillman, A., & Dalziel, T. (2003). Boards of directors and firm performance: Integrating agency and resource dependence perspectives. The Academy of Management Review, 28(3), 383–396.CrossRefGoogle Scholar
  36. Hillman, A., Cannella, A. A. J., & Paetzold, R. L. (2000). The resource dependence role of corporate directors: Strategic adaptation of board composition in response to environmental change. Journal of Management Studies, 37(2), 235–255.CrossRefGoogle Scholar
  37. Hillman, A. J., Cannella Jr, A. A., & Harris, I. C. (2002). Women and racial minorities in the boardroom: How do directors differ?. Journal of management, 28(6), 747–763.Google Scholar
  38. Hoitash, U. (2011). Should independent board members with social ties to management disqualify themselves from serving on the board? Journal of Business Ethics, 99(3), 399–423.CrossRefGoogle Scholar
  39. Jensen, M. C. (1993). The modern industrial revolution, exit, and the failure of internal control systems. the. Journal of Finance, 48(3), 831–880.CrossRefGoogle Scholar
  40. Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305–360.CrossRefGoogle Scholar
  41. Jensen, M. C., & Zajac, E. J. (2004). Corporate elites and corporate strategy: How demographic preferences and structural position shape the scope of the firm. Strategic Management Journal, 25(6), 507–524.CrossRefGoogle Scholar
  42. Jermias, J., & Gani, L. (2014). The impact of board capital and board characteristics on firm performance. British Accounting Review, 46(2), 135–153.CrossRefGoogle Scholar
  43. Jiraporn, P., Kim, Y. S., & Davidson, W. N., III. (2008). Multiple directorships and corporate diversification. Journal of Empirical Finance, 15(3), 418–435.CrossRefGoogle Scholar
  44. Johnson, S. G., Schnatterly, K., & Hill, A. D. (2012). Board composition beyond Independence: Social capital, human capital, and demographics. Journal of Management, 39(1), 232–262.CrossRefGoogle Scholar
  45. Jones, C. D., Makri, M., & Gomez–Mejia, L. R. (2008). Affiliate directors and perceived risk bearing in publicly traded, family–controlled firms: The case of diversification. Entrepreneurship Theory and Practice, 32(6), 1007–1026.CrossRefGoogle Scholar
  46. Kim, N., & Kim, E. (2015). Board capital and exploration: From a resource provisional perspective. Management Decision, 53(9), 2156–2174.CrossRefGoogle Scholar
  47. Kim, H., & Lim, C. (2010). Diversity, outside directors and firm valuation: Korean evidence. Journal of Business Research, 63(3), 284–291.CrossRefGoogle Scholar
  48. Kor, Y., & Misangyi, V. (2008). Outside directors’ industry-specific experience and firms’ liability of newness. Strategic Management Journal, 29(12), 1345–1355.CrossRefGoogle Scholar
  49. Kor, Y., & Sundaramurthy, C. (2008). Experience-based human capital and social capital of outside directors. Journal of Management, 35(4), 981–1006.CrossRefGoogle Scholar
  50. Kroll, M., Walters, B., & Wright, P. (2008). Board vigilance, director experience, and corporate outcomes. Strategic Management Journal, 29(4), 363–382.CrossRefGoogle Scholar
  51. Krueger, A. (1968). Factor endowments and per capita income differences among countries. The Economic Journal, 78(311), 641–659.CrossRefGoogle Scholar
  52. Lester, R., Hillman, A., Zardkoohi, A., & Cannella, A. A. J. (2008). Former government officials as outside directors: The role of human and social capital. Academy of Management Journal, 51(5), 999–1013.CrossRefGoogle Scholar
  53. Li, J., & Hambrick, D. C. (2005). Factional groups: a new vantage on demographic faultlines, conflict, and disintegration in work teams. Academy of Management Journal,  48(5), 794–813Google Scholar
  54. Lucas, R. (1988). On the mechanics of economic development. Journal of Monetary Economics, 22, 3–42.CrossRefGoogle Scholar
  55. Marvel, M., & Lumpkin, G. (2007). Technology entrepreneurs’ human capital and its effects on innovation radicalness. Entrepreneurship Theory and Practice, 31(6), 807–828.CrossRefGoogle Scholar
  56. McDonald, M., Westphal, J., & Graebner, M. (2008). What do they know? The effects of outside director acquisition experience on firm acquisition performance. Strategic Management Journal, 29(11), 1155–1177.CrossRefGoogle Scholar
  57. Midavaine, J., Dolfsma, W., & Aalbers, R. (2016). Board diversity and R & D investment. Management Decision, 54(3), 558–569.CrossRefGoogle Scholar
  58. Nicholson, G. J., & Kiel, G. C. (2004). A framework for diagnosing board effectiveness. Corporate Governance: An International Review, 12(4), 442–460.CrossRefGoogle Scholar
  59. Pérez-Calero, L., Villegas, M. D. M., & Barroso, C. (2016). A framework for board capital. Corporate Governance, 16(3), 452–475.CrossRefGoogle Scholar
  60. Sarto, F. (2016). 19. Il contributo del capitale umano nel consiglio di amministrazione. Aspetti teorici ed evidenze empiriche. Aracne: Roma.Google Scholar
  61. Sarto, F. (2019). Il ruolo del board human capital nel governo delle aziende. Profili teorici e riflessi sulla performance. Giappichelli: Torino.Google Scholar
  62. Sarto, F., Saggese, S., Viganò, R., & Mauro, M. (2020) Human capital and innovation: mixing apples and oranges on the board of high-tech firms. Management Decision, 58(5), 897–926Google Scholar
  63. Schultz, T. (1961). Investment in human capital. The American Economic Review, 51(1), 1–17.Google Scholar
  64. Stevenson, W. B., & Radin, R. F. (2009). Social capital and social influence on the board of directors. Journal of Management Studies, 46(1), 16–44.CrossRefGoogle Scholar
  65. Sundaramurthy, C., Pukthuanthong, K., & Kor, Y. (2014). Positive and negative synergies between the CEO's and the corporate board's human and social capital: A study of biotechnology firms. Strategic Management Journal, 35(6), 845–868.CrossRefGoogle Scholar
  66. Tian, J., Haleblian, J., & Rajagopalan, N. (2011). The effects of board human and social capital on investor reactions to new CEO selection. Strategic Management Journal, 32(7), 731–747.CrossRefGoogle Scholar
  67. Van Knippenberg, D., Dawson, J. F., West, M. A., & Homan, A. C. (2011). Diversity faultlines, shared objectives, and top management team performance. Human Relations, 64(3), 307–336.CrossRefGoogle Scholar
  68. Vandenbroucke, E., Knockaert, M., & Ucbasaran, D. (2016). Outside board human capital and early stage high–tech firm performance. Entrepreneurship Theory and Practice, 40(4), 759–779.CrossRefGoogle Scholar
  69. Veronesi, G., Kirkpatrick, I., & Vallascas, F. (2013). Clinicians on the board: What difference does it make? Social Science & Medicine, 77, 147–155.CrossRefGoogle Scholar
  70. Volonté, C., & Gantenbein, P. (2016). Directors’ human capital, firm strategy, and firm performance. Journal of Management & Governance, 20(1), 115–145.CrossRefGoogle Scholar
  71. Wang, C., Xie, F., & Zhu, M. (2015). Industry expertise of independent directors and board monitoring. Journal of Financial and Quantitative Analysis, 50(05), 929–962.CrossRefGoogle Scholar
  72. Weisbrod, B. (1966). Investing in human capital. The Journal of Human Resources, 1(1), 5–21.CrossRefGoogle Scholar
  73. Wellalage, N. H., & Locke, S. (2013). Women on board, firm financial performance and agency costs. Asian Journal of Business Ethics, 2(2), 113–127.CrossRefGoogle Scholar
  74. Westphal, J. D., & Bednar, M. K. (2005). Pluralistic ignorance in corporate boards and firms' strategic persistence in response to low firm performance. Administrative Science Quarterly, 50(2), 262–298.CrossRefGoogle Scholar
  75. Westphal, J. D., & Fredrickson, J. W. (2001). Who directs strategic change? Director experience, the selection of new CEOs, and change in corporate strategy. Strategic Management Journal, 22(12), 1113–1137.CrossRefGoogle Scholar
  76. Wincent, J., Anokhin, S., & Örtqvist, D. (2010). Does network board capital matter? A study of innovative performance in strategic SME networks. Journal of Business Research, 63(3), 265–275.CrossRefGoogle Scholar
  77. Zona, F. (2013). Corporate governance. Egea: Milano.Google Scholar

Copyright information

© Springer Nature Switzerland AG 2020

Authors and Affiliations

  1. 1.Department of Economics, Management, InstitutionsUniversity of Naples “Federico II”NaplesItaly

Section editors and affiliations

  • Kristijan Krkač
    • 1
  1. 1.Zagreb School of Economics and ManagementJordanovacCroatia