Entrepreneurial Orientation and Underconformity to Female Board Representation Norms

Despite mounting societal demands for increased female representation on corporate boards, some firms underconform to institutional expectations, exhibiting significantly lower female board representation than their country peers. We argue that a firm's entrepreneurial orientation is positively viewed by stakeholders, providing its corporate leaders with greater latitude to deviate from governance norms. Drawing from social role theory regarding beliefs about the association between entrepreneurial success and typical male traits, we propose that this substitutive legitimacy drives corporate leaders of firms with an entrepreneurial orientation to underconform due to a desire to maintain their firm's orientation. However, the history of female leadership in the firm and disclosure about environmental and social activities moderate the effect of entrepreneurial orientation on underconformity to female board representation norms. A generalized estimating equations analysis of 8410 firm‐year observations in 16 countries from 2012 to 2018 supports our predictions. Our study offers a novel explanation of heterogeneity in female board representation, informs theory of organizational non‐conformity to institutional norms, and highlights potentially unintended consequences of entrepreneurial orientation.