Title: The effects of boards of directors on R&D investments: the case of Spain

Authors: Ana B. Hernandez, Carmen Camelo, Ramon Valle

Addresses: Management Unit, Rovira i Virgili University, Avinguda Universitat 1, Reus, 43204, Spain. ' Department of Management, University of Cadiz, Glorieta Carlos Cano s/n, Cadiz, 11002, Spain. ' Department of Management, Pablo de Olavide University, Carretera Utrera, km. 1, Sevilla, 41013, Spain

Abstract: This paper analyses how the composition and ownership structure of boards of directors affect firms| R&D investments. Most research on the impact of the board focuses on corporate performance in an Anglo-American context. This study explores the influence of the board on R&D investments in the Spanish corporate governance system, which is different from the British and US systems. Data from 86 Spanish quoted companies in technology industries show that board composition influences R&D investments. Further, our results indicate that ownership structure can moderate the relation between board composition and R&D investments. This study states opposing hypotheses, based on arguments from agency and stewardship theories. We use these theories to analyse the influence of the board on R&D investments as a key factor for success in highly competitive technology industries.

Keywords: company directors; research and development; R&D; investment; Spain; corporate governance; technology industry; quoted companies; ownership structures; board composition; agency theory; stewardship; success rates; competition; competiveness; company performance; human resource development; HRD; human resource management; HRM.

DOI: 10.1504/IJHRDM.2010.031441

International Journal of Human Resources Development and Management, 2010 Vol.10 No.2, pp.152 - 165

Published online: 03 Feb 2010 *

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