What Combined Diversity Conditions of Board Directors Lead to Financial Sustainability? A Fuzzy Set Qualitative Comparative Analysis of Italian Universities

Although recent reforms of higher education (HE) across Europe have involved reconfigurations of internal governance structures, little research has been conducted on the characteristics and practices of governing bodies and their impact on performance. In particular, more empirical evidence is required on the composition of the board of directors, whose role and responsibilities in strategy making and monitoring of university activities have been significantly strengthened. This paper focuses on the issue of diversity in board composition, which has gained increasing attention in the corporate literature but has largely been ignored in HE. Since most studies of diversity in HE have been fragmented, a configurational approach is followed to examine the combinations of diversity of directors that lead to high board performance in universities. Drawing from the literature and considering the characteristics of university governance, four conditions are identified: age, gender, educational background and provenance. The method of fuzzy set qualitative comparative analysis (fsQCA) is used to investigate the cases of 18 medium-sized state universities in Italy. The analysis revealed that no single condition is necessary or sufficient, while there are two paths that lead to board effectiveness: low educational background diversity and high provenance diversity combined with high age diversity, and low educational background diversity and high provenance diversity combined with low gender diversity.