Human capital and innovation: mixing apples and oranges on the board of high-tech firms

Purpose – The purpose of this paper is to provide insights into the implications of board human capital heterogeneity for company innovation by focusing on the educational and the functional background of directors. Moreover, it examines the moderating effect of the CEO expertise-overlap within the innovation domain on the relationship between board human capital heterogeneity and firm innovation. Design/methodology/approach – The hypotheses are tested through a set of ordinary least squares regressions on a unique dataset of 149 Italian high-tech companies observed between 2012 and 2015. Findings – Findings show that the educational and the functional background heterogeneity of directors increase both the innovation input and output. However, results highlight that these relationships are negatively moderated by the CEO expertise-overlap within the innovation domain. Practical implications – The paper emphasizes the importance of appointing directors with different and specific educational and functional backgrounds to foster the company innovation. Originality/value – The paper fills a gap in the literature as it has devoted limited attention to the performance implications of board human capital heterogeneity in the high-tech industry where knowledge and skills are the primary sources of value. Moreover, the paper integrates the research on the CEO-board interface by shedding light on how the CEO expertise within the innovation domain affects the contribution of heterogeneous boards to company innovation.