Responsible innovation is the hope of facing grand challenges. Currently, European countries are establishing new policies and strategies to foster them. However, the concept is still at an embryonic level and requires a large focus from both practitioners and researchers. Additionally, a significant research gap exists in terms of the integrated corporate governance's effect on responsible innovation. Hence, in this study, we investigate the concept of responsible innovation and the effect of board diversity on German companies.
Our sample is composed of firms listed firms of the H-DAX index from 2010 to 2023. First, we used principal component analysis (PCA) to define responsible innovation. We then run our model using the generalized method of moments (GMM) estimation to test the effect of board diversity measures on responsible innovation.
Our results highlight the positive effect of board independence on responsible innovation. However, the board size and the female executive directors' presence have negative effects. Finally, we found that CEO duality has a significant positive influence on responsible innovation.
Although this study is limited to the German context, it provides an extensive view of how decision makers can manage and orient the board of directors and align their corporate governance toward responsible innovation targets.
The originality of this paper lies in the focus on the concept of responsible innovation, which remains underexplored, although it has gained increasing attention over the last century. It is crucial to orient the corporate governance structure toward responsibility and innovation.
