RT info:eu-repo/semantics/article
T1 The lines that divide: Board demographic faultlines and proactive environmental strategy
A1 Arena, Claudia
A1 García Torea, Nicolás
A1 Michelon, Giovanna
K1 Corporate Governance
K1 Board of directors
K1 Environmental factors
K1 Environmental strategies
K1 Faultlines
K1 Economía
K1 Economics
K1 Ciencias medioambientales
K1 Environmental sciences
AB Manuscript Type:The manuscript is of an empirical nature.Research Question/Issue:The current ecological crisis requires boards of directorsto tackle environmental concerns and manage dependencies with the external envi-ronment in highly dynamic conditions. Proactive environmental strategies (PESs) seekto establish alternative and innovative processes and products that create new mar-ket opportunities. By mobilizing the notion of board demographic faultlines, weinvestigate their link with PESs and the influence of the internal board dynamics andenvironmental factors on this relationship.Research Findings/Insights:The multilevel regression analysis of a 7-year sample ofUK boards reveals that demographic faultlines hinder their information processing inadopting PESs. The results also show that the negative relationship between demo-graphic faultlines and PESs is attenuated by the social similarity of the CEO and chairin the same subgroup and by the financial materiality of the natural environment.Theoretical/Academic Implications:This study draws on faultline theory to analyzehow the structure of board diversity through the alignment of multiple directors'demographic attributes affects board dynamics by creating polarized boards thatshape sustainability decisions. This study underscores the disruptive effect of havingsocially distanced subgroups within the board and the salience of board leaders'social similarity and environmental factors in attenuating their dysfunctional effects.Practitioner/Policy Implications:Board diversity is considered key to improvingboard decision-making. By situating our empirical investigation in a country with acorporate governance model that fosters diversity in a dual leadership board struc-ture that has influenced other countries' governance models, this study providesinsights for policymakers and market participants on the unintended effects of theglobal call for board diversity on firms' proactive environmental stance. Our resultscall for establishing procedures to incentivize board socialization and facilitate direc-tors' information processing.
PB Wiley
SN 0964-8410
YR 2024
FD 2024-02
LK http://hdl.handle.net/10259/8905
UL http://hdl.handle.net/10259/8905
LA eng
NO Spanish Ministry of Science and Innovation,Grant/Award Number: TED2021-129520B-I00; Agencia Nacional de Investigación,Grant/Award Number: PID2021-122389OB-I00; Junta de Castilla y León, Grant/AwardNumber: BU069P20.
DS Repositorio Institucional de la Universidad de Burgos
RD 17-may-2024