Together we win: The impact of board internationalization and board size on strategic change

Abstract This study explores the relationships between board internationalization, board size, and strategic change of firms from emerging markets. Building upon resource dependency theory (RDT), this study proposes that board internationalization has a positive impact on strategic change. A higher level of nationality heterogeneity on the board of directors, an organization receives more diverse perspectives and experiences from foreign directors. This, in turn, influences firms to identify areas of improvement and engage in strategic change. In addition, conventional wisdom suggests that board size per se has a negative relationship with strategic change. However, this study proposes that large board sizes together with board internationalization can foster strategic change. In other words, board size and board internationalization can jointly counteract the inertial nature of a large board, resulting in strategic change. The analyses of 255 publicly listed firms from nine emerging countries for the 2013–2018 financial years confirm these predictions.