African Journal of Business Management Vol. 5(34), pp. 13254-13266, 28 December, 2011
Available online at http://www.academicjournals.org/AJBM
DOI: 10.5897/AJBM11.1811
ISSN 1993-8233 ©2011 Academic Journals
Full Length Research Paper
Board structure and corporate entrepreneurship: A
case study of U.K
Satirenjit Kaur Johl
1
*, Alistair Bruce
2
and Martin Binks
2
1
Management and Humanities Department, Universiti Teknologi PETRONAS, Malaysia.
2
The University of Nottingham, United Kingdom.
Accepted 12 September, 2011
This study examines the relationship between corporate governance that is board structure and
composition and corporate entrepreneurship. Existing research examines aspects of governance and
entrepreneurship without any consideration of the links that may exist between these two drivers. This
study seeks to address this gap. Five propositions were developed to test the relationship of board
structure and corporate entrepreneurship: relationship between ratio of outsiders and the level of
corporate entrepreneurship; relationship between the presence of outside board of directors with
ownership and the level of corporate entrepreneurship; relationship between board size and corporate
entrepreneurship level in the organisation; relationship between the frequency of board meetings and
entrepreneurial activities; relationship between the frequency of board committee meetings and
entrepreneurial activities. A mixed method approach (pragmatic) was employed for testing these 5
propositions in triangulating and elaborating upon the research findings. Two qualitative studies were
undertaken to ascertain the nature of corporate entrepreneurship and corporate governance, as they
are generally perceived. This, along with other evidences, enabled the development of a corporate
entrepreneurship index and corporate governance index. A quantitative analysis using survey and
secondary data was then undertaken, based on the FTSE100 companies to ascertain the nature of
relationship between these two indices. Qualitative case studies were then used through an interview
process to gain deeper understanding of the issues involved. The findings indicated that certain
aspects of board structure and composition such as board size, frequency of board and sub-committee
meetings were found to impact negatively on entrepreneurial activities.
Key words: Corporate governance, corporate entrepreneurship, board structure, board composition,
triangulation.
INTRODUCTION
This paper discusses on the research conducted to
investigate the relationship between board structure and
composition and corporate entrepreneurship. The mixed
method approach (quantitative and qualitative) is used to
test five propositions and to triangulate and elaborate
upon the research findings. The triangulation method
*Corresponding author. E-mail: satire@petronas.com.my.
Abbreviations: NBSC, New bridge street consultant; ABI,
association of British insurers; USS, Universities
superannuation scheme; NED, non-executive directors; CEO,
chief executive officer.
allows the use of multiple measures and methods to
overcome the inherent weaknesses of a single
measurement instrument. Eisenhardt (1989) described
triangulation as a series of methods that aid data capture
and which can be used to substantiate hypotheses and
constructs.
In this paper a brief background of the research will be
given. Next, a discussion on the board of directors will be
made through answering the following questions:
1. Does the ratio of outsiders have an impact on
corporate entrepreneurship?
2. Does the presence of outside board of directors with
ownership have an impact on corporate entrepreneur-
ship?