Corporate entrepreneurship and governance structures in South African listed companies

Abstract

Entrepreneurship scholars tend to agree that the governance structures of a company influence its corporate entrepreneurial efforts and activities. Empirical studies have certainly supported this but have limited application to Africa as few studies have been conducted under said context.

This study empirically investigated the relationship between corporate governance structures and the corporate entrepreneurial efforts of publicly listed companies in South Africa. The study made use of secondary data sources including CIPC, IRESS and company annual reports. This was done to save time, costs and for ease of access to data. Multiple regression analysis was then used to test the hypotheses.

Following an investigation of 119 JSE listed firms, regression results revealed that a larger Board Size is positively associated with corporate entrepreneurship (CE) in South African (SA) registered firms as measured by research and development (R&D) expenditure. These results highlight the importance of a particular governance structure in relation to efforts to create sustainable long-term value and competitive advantages. Additionally, the findings provide key insights to scholars and policymakers where governance issues in an emerging market context serve as a catalyst for corporate entrepreneurial activities.