Building credible commitments via board ties: Evidence from the supply chain

• 成果类型: Article; Early Access
• 署名作者: Hann, Rebecca N.; Subasi, Musa; Zheng, Yue
• 署名单位: University System of Maryland; University of Maryland College Park; Hong Kong University of Science & Technology
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.3740
• 发表日期: 2025
• 关键词: board ties; CREDIBLE COMMITMENTS; relationship-specific investment; supply chain; transaction costs

摘要

Research SummaryUsing a novel dataset that provides a comprehensive coverage of U.S. firms' industrial supply chain relationships, we find that firms with innovation specific to a buyer are more likely to share a common director with that buyer. This association is stronger when the buyer has a larger number of alternative suppliers. We further find that when a supplier-buyer pair shares a common director, the supplier's R&D investment is more sensitive to the investment opportunities of its buyer. Moreover, such pairs tend to have longer supply chain relationships. Taken together, our findings demonstrate that board ties serve as a credible commitment mechanism to support exchange along the supply chain and safeguard suppliers' buyer-specific investments.Managerial SummaryOur research shows that suppliers who create products or technologies tailored to a specific buyer are more likely to share a board member with that buyer. This relationship is stronger when the buyer has many other suppliers. Shared board members facilitate better communication and alignment between suppliers and buyers, leading to more effective R&D investments and longer-lasting business relationships. These ties help reduce the risk for suppliers when investing in customized solutions. For business leaders, strategically leveraging board connections can strengthen supply chain partnerships, promote collaborative innovation, and safeguard investments in buyer-specific technologies.