Abstract
Drawing on the board capital literature, we use a panel data design to investigate the effect of boardroom nationality on the profitability and solvency of property-casualty insurers operating in the United Kingdom (UK). We find that boardroom nationality influences corporate outcomes depending on the financial aspects being measured. For example, North American directors are linked with profitable outcomes, while European directors tend to be associated with better solvency. This reflects differences between the shareholder value corporate culture in North America and stakeholder approaches more common in Europe. Our results could help insurers, regulators, and others (e.g., investors) to better understand the potential performance implications of the appointment of directors of different nationality.
| Original language | English |
|---|---|
| Article number | 100923 |
| Pages (from-to) | 1-18 |
| Number of pages | 18 |
| Journal | British Accounting Review |
| Volume | 53 |
| Issue number | 5 |
| Early online date | 22 Jun 2020 |
| DOIs | |
| Publication status | Published - 30 Sept 2021 |
Funding
We thank Chris Dawson and Thomas Roulet for their useful suggestions on improving the manuscript. The paper also benefited from the comments of participants at the 2016 British Accounting and Finance Association (BAFA) Conference, University of Bath, UK and attendees of seminars hosted by the Leeds University Business School, UK, Kings College, London, UK, and Coventry Business School, UK. However, the usual disclaimer applies.