Board human and social capital as moderators of internationalization and firm performance in South Asia
DOI:
https://doi.org/10.18488/29.v13i4.5264Keywords:
Board capital, Corporate governance, Emerging markets, Firm performance, Internationalization, RBV, RDT.Abstract
This study examines the relationship between internationalization and firm performance, with particular emphasis on the moderating role of board capital in publicly listed non-financial firms in emerging South Asian economies. Drawing on Resource Dependence Theory and the Resource-Based View, the study investigates whether board human capital and board social capital strengthen firms' ability to translate internationalization into improved financial performance. Using an unbalanced panel dataset of listed firms from Pakistan, India, and Bangladesh covering the period 2012–2023, the analysis employs fixed-effects regression models to control for unobserved firm heterogeneity and mitigate endogeneity concerns. The findings indicate that internationalization has a positive and heterogeneous effect on firm performance across the sampled countries. More specifically, the results show that board capital significantly enhances the performance benefits of internationalization. Firms with boards characterized by greater expertise, experience, diversity, and external networks are better equipped to identify international opportunities, acquire strategic resources, and respond to the institutional challenges associated with foreign market expansion. These findings underscore the significance of effective corporate governance in improving strategic decision-making and the success of internationalization in emerging markets. The study contributes to the international business and corporate governance literature by providing comparative evidence from South Asia and demonstrating that board capital is a valuable strategic resource that strengthens the relationship between internationalization and firm financial performance. The findings also offer practical implications for policymakers, regulators, and corporate boards seeking to promote sustainable international growth through stronger governance structures and more effective board composition.
