The Impact of CEO Characteristics on the Internationalization of SMEs: Evidence from the UK

• Author: Abubakr Saeed,Hafiz Muhammad Ziaulhaq
• Date: 01 September 2019
• DOI: http://doi.org/10.1002/cjas.1497
• Published date: 01 September 2019

The Impact of CEO Characteristics on the

Internationalization of SMEs: Evidence from

the UK

Abubakr Saeed*

Department of Management Sciences, COMSATS Institute

of Information Technology, Park Road, Chak Shahzad,

Islamabad 44000, Pakistan

Hafiz Muhammad Ziaulhaq

Department of Management Sciences, COMSATS Institute

of Information Technology, Park Road, Chak Shahzad,

Islamabad 44000, Pakistan

Abstract

This study analyses the role of chief executive off‌icers

(CEOs) in the internationalization of small- and medium-

sized enterprises (SMEs). Specif‌ically, it examines the im-

pact of CEOs’demographic characteristics on the interna-

tionalization of SMEs. Based on upper echelons theory,

resource-based view and information processing theory, it

is hypothesized that CEO characteristics like age, educa-

tion, tenure, and political connectedness affect SMEs’inter-

national performance. Using the panel data analysis of 283

UK SMEs for the period of 2005 to 2015, this study provides

evidence that CEOs’political connections and educational

level are positively related to f‌irm internationalization, while

age negatively inf‌luences f‌irm internationalization. Tenure is

found to have a curvilinear relationship with SMEs’interna-

tionalization. Copyright © 2018 ASAC. Published by John

Wiley & Sons, Ltd.

Keywords: CEO characteristics, SMEs, internationalization,

age, tenure, education, political connectedness

Résumé

Les auteurs de cette étude analysent le rôle des chefs

d’entreprise (PDG) dans l’internationalisation des petites

et moyennes entreprises (PME). Plus précisément, ils

examinent l’impact des caractéristiques démographiques

des PDG sur l’internationalisation des PME. En nous

appuyant sur la théorie des échelons supérieurs, sur celle

basée sur les ressources et sur la théorie du traitement de

l’information, nous posons comme hypothèse que les

caractéristiques telles que l’âge, l’éducation, la

titularisation et les liens politiques affectent la performance

des PME à l’échelle internationale. En utilisant l’analyse

des données du panel de 283 PME britanniques pour la

période allant de 2005 à 2015, cette étude fournit la preuve

que les relations politiques et le niveau d’éducation des

PDG sont positivement liés à l’internationalisation des

entreprises, tandis que l’âge l’inf‌luence plutôt négativement.

Par ailleurs, la titularisation a une relation curviligne avec

l’internationalisation des PME. Copyright © 2018 ASAC.

Published by John Wiley & Sons, Ltd.

Mots-clés: caractéristiques du PDG, PME,

internationalisation, âge, titularisation, liens politiques

Introduction

Growth by international expansion is an important stra-

tegic option for both small and large f‌irms. In the last de-

cade, the diversif‌ication into international markets and the

use of resources from foreign sources by small- and

medium-sized enterprises (SMEs) have increased dramati-

cally (Hsu, Chen, & Cheng, 2013). The internationalization

of SMEs is gaining further momentum as various aspects

such as globalization, dilution of government-imposed trade

barriers, and continued advances in technology have made

the world economy more integrated than ever.

The prominence of the internationalization phenomenon

has led researchers to examine the antecedents and the pro-

cess of internationalization (for instance, Francioni, Musso,

& Cioppi, 2015; Laufs, Bembom, & Schwens, 2016). The

existing research has investigated the antecedents of interna-

tionalization by focusing on endogenous factors (such as

f‌irm size, innovativeness, risk-taking, proactiveness) and ex-

ogenous factors (such as institutional support and culture)

(Hsu et al., 2013; Laufs et al., 2016). Few studies, however,

*Please address correspondence to: Abubakr Saeed, Department of Man-

agement Sciences, COMSATS Institute of Information Technology, Park

Road, Chak Shahzad, Islamabad, 44000, Pakistan. Email: abubakr.

saeed@comsats.edu.pk

Canadian Journal of Administrative Sciences

Revue canadienne des sciences de l’administration

36: 322–335 (2019)

Published online 7 May 2018 in Wiley Online Library (wileyonlinelibrary.com) DOI: 10.1002/CJAS.1497

Can J Adm Sci

36(3), 322–335 (2019)Copyright © 2018 ASAC. Published by John Wiley & Sons, Ltd. 322