Foreign entrepreneurs engage in less misconduct than native entrepreneurs: Evidence from U.K. director disqualifications

Although entrepreneurship is commonly viewed as a positive force for society, entrepreneurs may also engage in harmful activities. We explore whether foreign versus native entrepreneurs have a higher propensity to engage in misconduct, as evidenced by them being formally disqualified from being a director by the government following unfit conduct. Comparing entrepreneurs in the United Kingdom who were solely responsible for their venture and who were disqualified with a matched sample of entrepreneurs who did not engage in such misconduct, we find robust evidence that foreign entrepreneurs are substantially less likely to commit misconduct than native entrepreneurs. We also observe that female entrepreneurs are less likely to engage in misconduct than male entrepreneurs. We discuss the study's contributions to the entrepreneurship and organizational misconduct literatures and examine its practical implications.

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