Board of Directors Diversity and Interlock on acquisition performance. A quantitative research to the influence of Board diversity and Board interlock on acquisition performance.

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In this thesis, the influence of board nationality and gender diversity, together with board interlock, were studied in connection to acquisition performance, building on the upper echelon theory of Hambrick and Mason (1984). I theorized that diversity in nationality and gender, and an interlock between the boards of the acquiring and target firm, lead to improved acquisition performance, due to a diversity in mentality, knowledge, resources and inside information. To obtain results, an event study has been executed among European firms with completed acquisition within the period 2007-2019. A multiple regression analysis examined the effect of the board of directors on the cumulative abnormal return, the measure used for acquisition performance. Almost no regression models were significant, hence no relationship has been found between board nationality and gender diversity and board interlock on cumulative abnormal returns. A robustness check did show a significant effect on board gender diversity, but due to the inconsistency of the significance further research is required. Yet, theoretical and practical contributions were made towards the upper echelon theory and acquisition research.
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