The Relation Between Governance Traits and Performance: An Insight into Board Capital on Organizational Outcomes

Top managers hold apex positions in organizational hierarchies and guide their strategic decision-making processes, thus influencing the key outcomes. Unlike the traditional understanding of directors as homogeneous individuals in terms of background and professional experience, a growing corpus of research indicates that they exhibit varying degrees of heterogeneity, bringing distinct perspectives to the organizations they lead. The aim of this dissertation is to investigate to what extent top managers’ demographic, experiential, and relational attributes (seen as fundamental components of their decision-making process) shape, over time, organizational results, such as financial performance and service quality, particularly within the context of public healthcare sector. Building on the shortcomings of the traditional agency and resource dependence theories, the aforementioned interest in investigating heterogeneity in top management teams has led previous literature to develop alternative theoretical frameworks, such as board capital theory. In this sense, as a first step in examining this issue, a structured literature review on board human and social capital frameworks and the evidence of their influence on key organizational outcomes is provided. On an empirical level, this dissertation is mainly focused on the Italian public healthcare sector. It represents an interesting research context for two reasons. First, from a board capital perspective, it exhibits unique characteristics. On the other hand, this healthcare system was among the first to be affected by the Covid-19 pandemic, inevitably forcing healthcare organizations to be resilient and adapt to emerging challenges. In relation to the latter aspect, the first phase of the empirical investigation leverages the Upper Echelons Theory and develops a fuzzy set qualitative comparative analysis that seeks to shed light on the combinations of demographic and background characteristics of (hybrid professionals) managers that led public healthcare organizations towards adaptive resilience during the first wave of the pandemic in the Veneto Region (Italy). A subsequent phase of research involved a quantitative analysis of the extent to which the components (and their interrelationships) of board capital influence financial results and service quality within Italian public general hospitals during the period from 2018 to 2021. The main findings suggest that close ties to the political sphere appear to positively influence financial performance only when complemented by the business expertise within the team of directors. This thesis contributes to the body of research that recognizes the relevance of top managers' traits on organizational outcomes in different ways. First, through a review of the literature on board capital, it provides an inductive framework on its components and highlights their non-univocal impact on organizational outcomes. Second, examining the influence that managers' demographic characteristics have on the results of public healthcare organizations in times of uncertainty, we reveal the crucial role of the combinations of specific characteristics (female manager and having a long tenure in the organization) in shaping managers' decision-making process which enables organizations to be resilient. Third, building on the analysis of the influence that different board capital dimensions have on multiple aspects of public hospitals' performance, the significance of investigating the interactions between board human and social capital components and their varying effects on financial outcomes and service quality was emphasized.

Top managers hold apex positions in organizational hierarchies and guide their strategic decision-making processes, thus influencing the key outcomes. Unlike the traditional understanding of directors as homogeneous individuals in terms of background and professional experience, a growing corpus of research indicates that they exhibit varying degrees of heterogeneity, bringing distinct perspectives to the organizations they lead. The aim of this dissertation is to investigate to what extent top managers’ demographic, experiential, and relational attributes (seen as fundamental components of their decision-making process) shape, over time, organizational results, such as financial performance and service quality, particularly within the context of public healthcare sector. Building on the shortcomings of the traditional agency and resource dependence theories, the aforementioned interest in investigating heterogeneity in top management teams has led previous literature to develop alternative theoretical frameworks, such as board capital theory. In this sense, as a first step in examining this issue, a structured literature review on board human and social capital frameworks and the evidence of their influence on key organizational outcomes is provided. On an empirical level, this dissertation is mainly focused on the Italian public healthcare sector. It represents an interesting research context for two reasons. First, from a board capital perspective, it exhibits unique characteristics. On the other hand, this healthcare system was among the first to be affected by the Covid-19 pandemic, inevitably forcing healthcare organizations to be resilient and adapt to emerging challenges. In relation to the latter aspect, the first phase of the empirical investigation leverages the Upper Echelons Theory and develops a fuzzy set qualitative comparative analysis that seeks to shed light on the combinations of demographic and background characteristics of (hybrid professionals) managers that led public healthcare organizations towards adaptive resilience during the first wave of the pandemic in the Veneto Region (Italy). A subsequent phase of research involved a quantitative analysis of the extent to which the components (and their interrelationships) of board capital influence financial results and service quality within Italian public general hospitals during the period from 2018 to 2021. The main findings suggest that close ties to the political sphere appear to positively influence financial performance only when complemented by the business expertise within the team of directors. This thesis contributes to the body of research that recognizes the relevance of top managers' traits on organizational outcomes in different ways. First, through a review of the literature on board capital, it provides an inductive framework on its components and highlights their non-univocal impact on organizational outcomes. Second, examining the influence that managers' demographic characteristics have on the results of public healthcare organizations in times of uncertainty, we reveal the crucial role of the combinations of specific characteristics (female manager and having a long tenure in the organization) in shaping managers' decision-making process which enables organizations to be resilient. Third, building on the analysis of the influence that different board capital dimensions have on multiple aspects of public hospitals' performance, the significance of investigating the interactions between board human and social capital components and their varying effects on financial outcomes and service quality was emphasized.