Board competence and green innovation—Does external governance matter?

• Published in: Business strategy and the environment Vol. 33; no. 4; pp. 3078 - 3102
• Main Authors: Yousaf, Umair Bin, Tauni, Muhammad Zubair, Yousaf, Imran, Su, Nancy Lixin
• Format: Journal Article
• Language: English
• Published: Chichester Wiley Periodicals Inc 01.05.2024; Wiley
• Subjects: Attributes; Audit quality; board competence; board of directors; Boards of directors; Business administration; Competence; Corporate strategies; Empirical analysis; external governance; External pressure; Governance; green innovation; Humanities and Social Sciences; imitative pressure; Innovations; Media coverage; Policy making; audit quality,board competence,board of directors,external governance,green innovation,imitative pressure,media coverage
• ISSN: 0964-4733; 1099-0836
• DOI: 10.1002/bse.3641

Previous research examining the link between board attributes and ecological strategies such as green innovation has primarily focused on structural board attributes, yielding mixed findings. Moreover, the critical contextual grounds that shape the relationship between board attributes and green innovation have often been overlooked, leading to potential biases in empirical investigations. Considering that competence drives outstanding performance, we developed a unique measure of board competence that represents the board's intrinsic ability to perform in corporate strategies. Drawing on a holistic perspective of agency, resource dependence, and stakeholder theories, we posit a strong relationship between board competence and green innovation. Furthermore, we contend that this association is moderated by external governance mechanisms, namely audit quality, media coverage, and imitative pressure. Through our analysis of publicly traded Chinese companies, we found compelling evidence to support our assertions. These findings have important implications for policymakers, practitioners, and managers.