Foreign Directors

• In Event: Board of Directors Issues

Abstract

We empirically examine director appointments on corporate boards around the world. We posit that characteristics related to higher levels of human capital increase the likelihood that a director is appointed to a foreign corporate board, and greater country level economic development increases the likelihood that a director serves on a corporate board in a specific country, although frictions such as geographic and cultural distance reduce this likelihood. Consistent with our hypotheses, we find that corporate boards in economically significant countries have more foreign directors from other economically significant countries, and common borders and geographic proximity increase cross-country director appointments. We further find that the likelihood of a foreign appointment is lower for professionally certified directors, female directors, and directors with a single board appointment, and higher for directors that are older and more experienced, holding an MBA or degree from a internationally ranked university, and with higher reputation.

Authors

• John Manuel Barrios, University of Miami

• Pietro Andrea Bianchi, University of Miami

• Helena Isidro, Instituto Universitario de LIsboa

• Dhananjay Nanda, University of Miami