The impact of business environment and boards of directors on strategic decision-making: A case study of Greek listed companies

Abstract

This thesis documents a study of the factors associated with Boards of Directors’ strategic decisions. The premise upon which such a research initiative is founded concerns the increased interest of academics and business practitioners in Board of Directors in the U.K and in U.S in part arising from recent financial scandals made in major public companies. Despite this increased attention to Board of Directors, it is acknowledged that Boards of Directors is one of the most under-researched management topics and its research is limited in scope and scale. An extensive review of the literature revealed that a useful contribution to knowledge could be derived from the investigation of the factors that influence Boards’ strategic decisions in quoted organisations. The research objectives is then to investigate the strategic decisions Boards of Directors and the organisation make by examining the environmental factors associated with the Board, the characteristics of the Board such as age, education, experience, composition, the Boards’ strategic choices in areas such as innovation, strategic decisions and to examine the influence the Boards have on performance. Despite the significant research interest in this topic, knowledge is still incomplete. This thesis makes a significant contribution to the strategic management literature by developing an integrative framework which examines strategic decisions from both content and process perspectives. The model developed, identifies the influence on strategic decisions, the environment, the characteristics of the Boards of Directors and its involvement has as influence on strategic decisions. The empirical study is carried out in a new cultural context; Greece and more specifically to listed firms on the Athens Stock Exchange. A theoretical model has been created and following a deductive approach, primary data through questionnaires was collected from 105 Greek listed organisations. Data was analysed according to their descriptive properties and underlying correlation structure. Several principal components were derived from these analyses which were used in hypothesis testing. Subsequently, a multiple regression and GLM analyses were conducted in order to examine the interrelationships between the factors associated with Boards’ strategic decisions. The research findings are discussed and considered in light of current knowledge in the area. A number of conclusions are made from the findings. Furthermore, implications for academics and business practitioners are drawn that indicate the relevance and applicability of this research to corporate governance practices. Limitations of the research and possible future research are set out. The thesis is organised into seven chapters which are entitled in the following order: literature review of Boards of Directors and development of theoretical framework; empirical approach and conceptualisation of the factors associated with boards’ strategic decisions; descriptive research findings; principal component analysis and construction of scale indices; multiple regression and GLM analyses; and, conclusions and implications of the study.