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Author ORCID Identifier

https://orcid.org/0000-0001-2345-6789

Date Available

5-8-2028

Year of Publication

2026

Document Type

Doctoral Dissertation

Degree Name

Doctor of Philosophy (PhD)

College

Business and Economics

Department/School/Program

Accountancy

Faculty

Monika Causholli

Faculty

David Ziebart

Abstract

This study examines whether heterogeneity in directors’ nationality across external board networks is associated with firm value and operating performance. Using 26,414 firm-year observations from 4,152 U.S.-listed firms from 2010 to 2020, I measure network nationality heterogeneity based on the national backgrounds represented in directors’ concurrent outside board ties. I test two hypotheses. First, greater nationality heterogeneity is positively associated with higher one-year-ahead characteristic-adjusted abnormal returns: a one-quintile increase corresponds to a 1.1 percentage point return premium, and an equal-weighted hedge portfolio earns 2.14 percent annually. Second, nationality heterogeneity is positively associated with next-year changes in ROA. Both associations are concentrated among firms with low within-board nationality heterogeneity, consistent with external network diversity substituting for internal board diversity in shaping governance quality. I also find that the return effect is stronger among firms with greater foreign subsidiary breadth, consistent with internationally connected networks providing incremental value in globally complex settings. The evidence indicates that who directors are connected to—not merely how many connections they hold—is an economically meaningful dimension of corporate governance.

Digital Object Identifier (DOI)

https://doi.org/10.13023/etd.2026.213

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Funding Information

Von Allmen School of Accountancy

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