Board size and corporate performance: the missing role of board leadership structure

2009 ◽  
Vol 15 (3) ◽  
pp. 415-446 ◽  
Author(s):  
Khaled Elsayed
Keyword(s):  
Corporate Performance ◽  
Board Size ◽  
Board Leadership ◽  
Leadership Structure ◽  
Board Leadership Structure

scholarly journals Exploring the Role of Board Characteristics on Enhancing Financial Performance of Jordanian Listed Companies

2017 ◽  
Vol 9 (7) ◽  
pp. 99
Author(s):  
Laith A Alaryan
Keyword(s):  
Financial Performance ◽  
Annual Reports ◽  
Board Composition ◽  
Board Size ◽  
Positive Role ◽  
Board Characteristics ◽  
Board Leadership ◽  
Leadership Structure ◽  
Board Leadership Structure

Corporate governance considered important topic at the local and international levels, especially after many financial crises and corporate failures and such as Enron and World Com This paper aims to explore the role of board characteristics, (i.e. board size, board composition and board leadership structure) on enhancing firms’ financial performance; this study used the non-financial companies’ annual reports for 6 years (2011-2016) to extract the needed information. The non- financial sector consisted form 167 companies, only 139 companies are included in this study due the lack of data during study’s period. The results revealed that there is a positive role for board composition, board leadership structure, board size, on enhancing financial performance, while there is no significant role for board tenure, on financial performance. These mixed results on the relationship between board characteristics and financial performance have opened up possible research area in the future. For instance, extending the sample to comprise more sectors from Amman Stock Exchange is worthwhile to further support or refute the results of this study.

scholarly journals Board leadership structure and earnings quality

2018 ◽  
Vol 3 (1) ◽  
pp. 82-111 ◽  
Author(s):  
Chinedu Francis Egbunike ◽  
Augustine N. Odum
Keyword(s):  
Earnings Quality ◽  
Main Concern ◽  
Board Structure ◽  
Executive Directors ◽  
Board Size ◽  
Ceo Duality ◽  
Content Type ◽  
Board Leadership ◽  
Leadership Structure ◽  
Board Leadership Structure

Purpose One main concern and issue affecting earnings quality is the extent to which managers manipulate earnings to mislead stakeholders about the underlying economic performance of the company or to influence contractual outcomes that depend on reported accounting numbers. This study builds on prior research and examines empirically the relationship between board leadership structure and earnings quality of manufacturing firms in Nigeria. The purpose of this paper is to specifically focus on four board structure characteristics: board size, composition, proportion of non-executive directors and CEO duality. Design/methodology/approach Data used for this investigation were collected from secondary sources, i.e. annual reports and accounts. The study used the Pooled OLS regression model to examine the effect of the board structure on earnings management for a sample of 45 non-financial listed Nigerian companies (conglomerates, consumer goods and industrial goods firms) for the years 2011 to 2016. Findings Based on the analysis, board size and board composition were positive and significant. However, proportion of non-executive directors was negative and significant; while, CEO duality was positive and statistically significant. It was consequently recommended that audit firms should review their audit business model and become more circumspect of their client, e.g. provide fraud assessment and checks for earnings quality. Boards should not just reflect size but rather the skills and expertise of individuals appointed to the board. Furtherance to this, the effectiveness of boards can be improved by committees and sub-committees allocation of duties. Originality/value Few studies have addressed this area in the country.

The Role of Board Leadership Structure in Firm Governance

2021 ◽  
Author(s):  
Danuse Bement ◽  
Ryan Krause
Keyword(s):  
Firm Performance ◽  
Independent Director ◽  
Negative Consequences ◽  
Ceo Duality ◽  
Board Chair ◽  
Board Committees ◽  
Board Leadership ◽  
Leadership Structure ◽  
Board Leadership Structure

Boards of directors are governing bodies that reside at the apex of the modern corporation. Boards monitor the behavior of firm management, provide managers access to knowledge, expertise, and external networks, and serve as advisors and sounding boards for the CEO. Board attributes such as board size and independence, director demographics, and firm ownership have all been studied as antecedents of effective board functioning and, ultimately, firm performance. Steady progress has been made toward understanding how boards influence firm outcomes, but several key questions about board leadership structure remain unresolved. Research on board leadership structure encompasses the study of board chairs, lead independent directors, and board committees. Board chair research indicates that when held by competent individuals, this key leadership position has the potential to contribute to efficient board functioning and firm performance. Researchers have found conflicting evidence regarding CEO duality, the practice of the CEO also serving as the board chair. The effect of this phenomenon—once ubiquitous among U.S. boards—ranges widely based on circumstances such as board independence, CEO power, and/or environmental conditions. Progressively, however, potential negative consequences of CEO duality proposed by agency theory appear to be counterbalanced by other governance mechanisms and regulatory changes. A popular mechanism for a compromise between the benefits of CEO duality and independent monitoring is to establish the role of a lead independent director. Although research on this role is in its early stage, results suggest that when implemented properly, the lead independent director can aid board monitoring without adding confusion to a unified chain of command. Board oversight committees, another key board leadership mechanism, improve directors’ access to information, enhance decision-making quality by allowing directors to focus on specialized topics outside of board meetings, and increase the speed of response to critical matters. Future research on the governance roles of boards, leadership configurations, and board committees is likely to explore theories beyond agency and resource dependence, as well as rely less on collecting archival data and more on finding creative ways to access rarely examined board interactions, such as board and committee meetings and executive sessions.

Earnings Informativeness, Board Size, Board Composition and Board Leadership Structure

2015 ◽  
Vol 21 (5) ◽  
pp. 1513-1516
Author(s):  
Kamarul Bahrain Abdul-Manaf ◽  
Noor Afza Amran ◽  
Rokiah Ishak
Keyword(s):  
Board Composition ◽  
Board Size ◽  
Earnings Informativeness ◽  
Board Leadership ◽  
Leadership Structure ◽  
Board Leadership Structure

scholarly journals Firm complexity and corporate board size: testing the moderating effect of board leadership structure

2010 ◽  
Vol 7 (4) ◽  
pp. 114-126 ◽  
Author(s):  
Hayam Wahba ◽  
Khaled Kadry Elsayed
Keyword(s):  
Corporate Governance ◽  
Organizational Adaptation ◽  
Corporate Board ◽  
Board Size ◽  
Policy Makers ◽  
Listed Firms ◽  
Board Leadership ◽  
The Board Of Directors ◽  
Leadership Structure ◽  
Board Leadership Structure

Most prior studies have argued that the relationship between firm complexity and board size is a monotonic one: complex firm tend to have a large board size. Contrary to previous work, it is hypothesized in this study that this relationship is more likely to be moderated by board leadership structure. Using a sample of 92 Egyptian listed firms over the period from 2000 to 2004, we found that firm complexity exerted a positive and significant coefficient on board size when the firm adopts a leadership structure that separates the roles of CEO and chairman. However, the incremental effect of firm complexity on board size was negative and significant for firms that combine the roles of CEO and chairman (i.e., CEO duality). This study provides supportive evidence for the argument that firms are more likely to manipulate their boards’ characteristics to attain organizational adaptation at the minimum total cost. Thus, studying of one main characteristic of the board of directors without taking into account the expected effect of other characteristics may lead to inconclusive evidence. This study offers insights to practising managers and policy makers. If practising managers want to maximize the value of their firms, they need to broaden their insight to understand that board characteristics are multidimensional, contingent and dynamic in their nature and differ not only across firms and industry, but also across countries. Moreover, before developing and launching new and additional corporate governance reforms, policy makers need to realize that differences in corporate governance systems cannot be fully explained outside their institutional environments.

scholarly journals Corporate governance, cultural factors and voluntary disclosure: Evidence from selected companies in Bangladesh

2012 ◽  
Vol 8 (1) ◽  
pp. 48-61 ◽  
Author(s):  
Md. Akhtar Uddin ◽  
Md. Abdur Rouf
Keyword(s):  
Corporate Governance ◽  
Voluntary Disclosure ◽  
Audit Committee ◽  
Listed Companies ◽  
Cultural Factors ◽  
Board Size ◽  
Management Ownership ◽  
Board Leadership ◽  
Leadership Structure ◽  
Board Leadership Structure

This research aims to test empirically the relationship between corporate governance, cultural factors and voluntary disclosure by the listed companies in Bangladesh. The corporate governance factors examined are proportion of independent non-executive directors (INDs), board leadership structure, management ownership, board size and audit committee size. The extent of voluntary disclosure level is measured using 68 items of information. Data are taken from annual reports of the listed companies in Bangladesh. The result shows a positive association between board size, board leadership structure, audit committee size and voluntary disclosure. However, no evidence is found to support the contention that independent directors are associated with increased disclosure, consistent with previous studies. Higher education of the CEO and CFO is positively related to the level of voluntary disclosure. The result also indicates that the extent of voluntary disclosures is negatively associated with a higher management ownership

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