Falco Hartenfelser
MBA class of 2015
Falco used to be a MBA student at Frankfurt School and graduated in 2015....

Connecting scientific methodology with practical application

May 12, 2016
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– how the development of a master thesis contributes to the whole MBA-experience

Given the fact that The Frankfurt Full-Time MBA program is supposed to be an intense one-year comprehensive management program, it is not surprising that the months spent at campus flew very fast. This holds even more true considering the variety of courses and learning styles from seminars in foreign countries, visiting professors and hands-on group work often accompanied by international conglomerates.

What is actually more astonishing is that one of the most intense and demanding phases of the program not only went by so fast (of course it did…), but that students jumping to another position in their career rarely take the time to reflect of what they achieved and how it helped their future development. This is why I am summarizing my main insights from the thesis period that took place from September – November 2015. Besides that, the graduation ceremony in May 2016 is also a pleasant opportunity to remember what the whole intake has left behind by now.

Why actually a master thesis – instead of a group consulting project or a business plan?

Let me make it clear that all three options for graduating with the MBA degree at Frankfurt School of Finance & Management do have advantages and the choice should be dependent on capabilities, strengths and personal likings. However, my intention of developing a thesis on my own was the challenge to work in a scientific manner that I have never done before with such a depth of information and data. And Prof. Dr. Sautner was the perfect partner providing interesting topics and feedback on a regular basis!

The result – my submitted thesis – outlines an empirical research study on German supervisory boards and their potential impact on firm value. Following the hypothesis that a larger share of financial experts in German supervisory boards is a driver of firm value defined by Tobin’s Q, the sample consists of the large mature German companies listed in the DAX 30 and their supervisory board compositions from 2005-2014.

Methodically, I followed the literature by defining a financial expert being a member of a supervisory board with proper financial literacy gained with specialized education and past career stages in relevant financial areas. To identify these members on the supervisory boards, I manually reviewed more than 800 profiles and distributed the suitable attributes to define a percentage of financial experts on a supervisory board in a certain year.

Working on details without missing the bigger picture – a process that requires endurance and self-discipline

Before this continuous development of a solid database, I closely worked with Prof. Dr. Sautner supervisor on the goals, timeline and potential pitfalls of my research. The biggest challenge possibly was to identify scenarios that might occur and to document every step and the rationale behind it for the sake of having the option to go back to a past milestone and start over. However, this was not often the case – which was most likely due to the fact that I worked closely with my supervisor and defined regular milestones and personal meetings along the way. 

By the way, are you interested in the results of my research? Well, the empirical results do not state that financial expertise in German supervisory boards is a clear driver of firm value. Nevertheless, the model shows significant differences among the industries in which the companies can be placed. Main reasoning for a weaker causal relationship between financial expertise in boards and firm value in comparison to other international studies is possibly due to the German dual-board structure, which institutionalized the supervisory board more as a controlling body and not as a steering entity.

Therefore, further research should consider a different sample selection of German firms and possibly use more qualitative panel data to provide valuable insights of board behavior. Moreover, industry-related idiosyncrasies should be considered more by deeper investigating the firm value outcomes within an industry peer-group – something that can be considered by my successors of the upcoming intakes.


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