scholarly journals The Impact of Board Diversity, CEO Characteristics, and Board Committees on Financial Performance in the Case of Romanian Companies

2021 ◽  
Vol 15 (1) ◽  
pp. 7
Author(s):  
Bogdan Aurelian Mihail ◽  
Dalina Dumitrescu ◽  
Carmen Daniela Micu ◽  
Adriana Lobda
Keyword(s):  
Financial Performance ◽  
Audit Committee ◽  
Stock Exchange ◽  
Board Members ◽  
Board Diversity ◽  
Board Committees ◽  
Positive Effects ◽  
Governance Practices ◽  
The Impact ◽  
Ceo Characteristics

This paper examines the impact of board diversity, CEO characteristics, and board committees on the financial performance of the companies listed on the Bucharest Stock Exchange (BSE). In order to test the influence of these characteristics, detailed data on more than 70 firms are collected by hand, for the 2016–2020 period, and comprehensive regression models are estimated. The findings show that there are positive effects of board diversity especially with regard to the independent board members. In terms of the board committees, the audit committee is found to have a favourable influence. The regression coefficients imply that a 10% increase in the share of independent board members would be associated with a 0.93% increase in ROE. Based on these findings, it can be argued that improving the corporate governance practices of the companies listed on the BSE would increase the performance and the value of these firms.

scholarly journals Impact of Corporate Governance on Financial Performance: Karachi Stock Exchange, Pakistan

2016 ◽  
Vol 6 (2) ◽  
pp. 401 ◽  
Author(s):  
Aon Waqas Awan ◽  
Javed Ahmed Jamali
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Audit Committee ◽  
Stock Exchange ◽  
Profit Margin ◽  
Audit Committees ◽  
Board Size ◽  
Good Decision ◽  
Return On Equity ◽  
The Impact

The aim of the research is to understand the impact of corporate governance on financial performance of listed companies on Karachi Stock Exchange Pakistan. Data was collected from forty two companies from different sectors like, insurance, banking, investment banking, and sugar industries. Study includes variables like profit margin & return on equity as a dependent (profitability) and board size, audit committee, annual general meetings & chief executive office (corporate governance). Using Pooled OLS, the result of the study proved those board size and audit committees have positive relationship with Profit margin and Return on Equity, if any independent variable changes it also stimulus the positively changing impact on Return on Equity (ROE) and Audit Committee (AC). This research offers imminent guidelines to the policy and decision makers in any type of firms to take good decision to set their firms hierarchy system.

Financially Qualified Audit Committee Member and Corporate Sustainability: Evidence from Emerging Economy

2018 ◽  
Author(s):  
Ashfaque Banbhan ◽  
Xinsheng Cheng ◽  
Nizam Ud Din
Keyword(s):  
Financial Performance ◽  
Audit Committee ◽  
Positive Relationship ◽  
Stock Exchange ◽  
Corporate Sustainability ◽  
Committee Member ◽  
Positive Relation ◽  
Accrual Quality ◽  
The Impact ◽  
The Relationship

This paper examines the relationship between financial qualification of the audit committee (AC) chairman on corporate sustainability (CS) in developing the economy of Pakistan, which has a weak corporate environment. In a sample of companies listed on Pakistan Stock exchange (PSX) during 2010-2014. Empirical results of 1020 firm-year observations indicate that the presence of financially qualified AC chairman has a positive relationship with firm’s accrual quality. The results found that accounting qualification of AC chairman has significant positive relation with CS performance. Furthermore, the study found that powerful CEO is also not able to influence CS in the presence of accounting qualified AC chairman, but this result is not present if AC chairman is non-accounting qualified. This study extends the literature on the impact of accounting qualification of AC members and CS and offers some significant understanding into efficient corporate practices to achieve sustainability goals. This study suggests the presence of accounting qualified member in AC which results in effective monitoring for the increased financial performance of the organization.

scholarly journals The financial impacts of board mechanisms on performance: The case of listed Moroccan banks

2021 ◽  
Vol 3 (2) ◽  
pp. 93-113
Author(s):  
Issam El Idrissi ◽  
◽  
Youssef Alami ◽  
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Fixed Effects ◽  
Audit Committee ◽  
Negative Impact ◽  
Governance Mechanisms ◽  
Return On Equity ◽  
Corporate Governance Mechanisms ◽  
Governance Practices ◽  
The Impact

Abstract Purpose: The present study examines the impact of corporate governance mechanisms on listed Moroccan banks' financial performance. Research methodology: This study investigates the relationship between listed banks' governance mechanisms and financial performance in the CSE for six years between 2014-2019. This study employs three performance measures, return on assets, return on equity, and Tobin's Q, to determine bank performance. This research uses the GMM EGLS approach to analyze data. In the first phase of this empirical research, we did use OLS, Fixed Effects, and Radom Effects regressions to show their inefficiency. Results: Our results portray that most board mechanisms have a negative impact on financial performance. In comparison, the audit committee and nomination & remuneration committee have a positive effect on financial performance. Limitations: Many qualitative and quantitative factors could influence financial performance and not only the used variables in this paper. Contribution: This research shows that the dynamic connection between corporate governance and financial performance is robust in the Moroccan banking context. Also, our study has important implications for establishing good corporate governance practices in emerging economies.

scholarly journals AN EXAMINATION OF VOLUNTARY DISCLOSURE, INDEPENDENT BOARD, INDEPENDENT AUDIT COMMITTEE AND INSTITUTIONAL OWNERSHIP: FIRM SIZE AS A MODERATOR

2019 ◽  
Vol 2 (2) ◽  
pp. 509
Author(s):  
Hisar Pangaribuan
Keyword(s):  
Firm Size ◽  
Voluntary Disclosure ◽  
Audit Committee ◽  
Final Section ◽  
Stock Exchange ◽  
Institutional Ownership ◽  
Board Members ◽  
The Public ◽  
The Impact ◽  
Independent Audit

: This study examines the impact of the independent board, independent audit committee and institutional ownership on voluntary disclosure (by placing company size as a moderating variable) in Indonesia banking companies. Data collected from the annual report of banking companies listed on the Indonesia Stock Exchange throughout the year of study. Hypotheses developed to be tested with a variance based approach and the results were interpreted. The result has shown that the increase of independent board members and independent audit committee members tend to decrease the level of voluntary disclosure (although the impact is not significant). Independent board and independent audit committee performed this to reduce cost due to a high disclosure and to avoid the threat of high competition in banking companies. The other result has shown that institutional investors are considered more professional and powerful in supervising management to disclose more information to the public. The final section of the study's findings indicated that firm size cannot be as a moderating variable on the impact of the independent board, independent audit committee and institutional ownership toward voluntary disclosure.

scholarly journals The impact of the board of directors on the financial performance of Tunisian companies

2012 ◽  
Vol 8 (3) ◽  
pp. 6-21
Author(s):  
Zied Bouaziz ◽  
Mohamed Wajdi Triki
Keyword(s):  
Financial Performance ◽  
Board Of Directors ◽  
Audit Committee ◽  
Stock Exchange ◽  
Gender Diversity ◽  
Linear Regression Models ◽  
The Board Of Directors ◽  
Internal Mechanism ◽  
And Control ◽  
The Impact

The Board of Directors plays a key role as a internal mechanism of corporate governance. Indeed, its effectiveness is dependent on the presence of several factors, the most important are related to characteristics that relate primarily to the independence of its members, board size, the cumulative functions of decision and control, the degree of independence of the audit committee and the gender diversity of the board. To test the validity of our hypothesis, which states the existence of a certain deterministic between the board’s characteristics and financial performance measured by three different ratios, namely ROA, ROE and Tobin’s Q, we have developed three linear regression models. Our empirical validation was conducted on a sample of 26 companies listed on the Tunisian stock exchange Tunis (Tunis Stock Exchange) over a period that spans four years (2007-2010). The estimated models show satisfactory results showing the importance of the impact of board characteristics on financial performance of Tunisian companies.

The Impact of Stock Exchange Rules on the Federalization of Corporate Governance

2018 ◽  
Author(s):  
Marc I. Steinberg
Keyword(s):  
Corporate Governance ◽  
Government Regulation ◽  
Stock Exchange ◽  
Codes Of Ethics ◽  
Stock Exchanges ◽  
Significant Component ◽  
Board Committees ◽  
Governance Practices ◽  
Nominating Committees ◽  
The Impact

This chapter focuses on the important role that the national stock exchanges play in the federalization of corporate governance. Responding to federal legislative and SEC directives and, at times, acting on their own initiative, the stock exchanges have promulgated meaningful rules that comprise a significant component of the corporate governance landscape. Although technically not government regulation, the national stock exchanges play a central role in the enhancement of sound corporate governance practices and policies. Examples include the emphasis by the exchanges on independent directors, board committees (including audit, compensation, and nominating committees), and corporate codes of ethics. Hence, when addressing the federalization of corporate governance, stock exchange regulation is to be given prominent status.

scholarly journals Corporate Governance Mechanisms and Firm’s Performance: Evidence from Jordan

2020 ◽  
Vol 9 (2) ◽  
pp. 11
Author(s):  
Mohammad Abdullah Fayad Altawalbeh
Keyword(s):  
Corporate Governance ◽  
Stock Exchange ◽  
Board Members ◽  
Board Structure ◽  
Government Ownership ◽  
Governance Mechanisms ◽  
Financial Reports ◽  
Corporate Governance Mechanisms ◽  
Governance Practices ◽  
The Impact

The purpose of this study is to investigate the effect of corporate governance mechanisms on the firm’s performance. Corporate governance practices were divided into two groups; board structure and ownership structure. The sample of the study consists of 60 companies from industrial and service sectors that are listed on Amman stock exchange (ASE). Data was gathered manually through the annual financial reports for the period from 2012-2017 results in 366 year-observation. Stata statistical software was used to test the study hypotheses. The results revealed that board meetings frequency and government ownership positively and significantly impact the firm’s performance, these results suggest that board meetings frequency is considered an indicator of the board effectiveness that enhances decision making quality and thus the firm performance, the results suggest that government ownership is providing a helping hand that improves the firm’s performance. The findings also showed that board independence negatively and significantly impact the firm’s performance, this result suggests that independent board members do not guarantee to improve the performance of a firm, and it stays the firm’s responsibility to choose independent board members who are able to exercise effective oversight function for the purpose of enhancing the performance of a firm. This study contributes to the literature by providing empirical evidence from developing countries about the impact of corporate governance measures and practices on firms’ performance.

Board Diversity and Its Effects on the Functionality of Boards in South Africa

2021 ◽  
pp. 1-23
Author(s):  
Thokozani Ian Nzimakwe
Keyword(s):  
South Africa ◽  
Boards Of Directors ◽  
Information Needs ◽  
Board Members ◽  
Board Effectiveness ◽  
Board Diversity ◽  
Board Committees ◽  
The Impact ◽  
Practical Implications

The structure and composition of the board are determined by the characteristics of an organisation, its environment, and its information needs. If the role of the board is to advise and supervise, this then talks to the relationships that account for its composition so that it may carry out these duties. Boards of directors are now faced with a change in the priority of the functions that must be undertaken by them, with supervision and monitoring being more important than the usual function of administration. The chapter discusses the literature on board diversity, corporate governance, role of the boards of public entities, effectiveness of boards, role of board committees, strategic leadership theory, and the impact of board diversity on board effectiveness. In terms of practical implications, the chapter makes a unique and significant contribution to the functionality of board members in South Africa. The analysis may encourage board nomination committees to seek board diversity beyond the gender and ethnic characteristics of directors.

scholarly journals Relationship of board diversity with firm’s financial performance: The case of publicly listed companies in China

2021 ◽  
Vol 19 (1, special issue) ◽  
pp. 229-240
Author(s):  
David Qian ◽  
Wahed Waheduzzaman ◽  
Sarod Khandaker
Keyword(s):  
Financial Performance ◽  
Stock Exchange ◽  
Listed Companies ◽  
Hierarchical Regression ◽  
Measurement Tool ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Board Diversity ◽  
Value Measurement ◽  
The Impact

This study examines the impact of board diversity including the gender, nationality, and independence of board members on the financial performance of publicly listed companies in China. This study uses a sample of 206 publicly listed companies on the Shanghai Stock Exchange and the Shenzhen Stock Exchange in China to measure the impact of board diversity on their financial performance. Organizational financial performance is measured with the widely-used accounting-based measurement tool return on asset (ROA), and the market value measurement tool Tobin’s Q. After applying a hierarchical regression analysis this study finds that women on the board impact positively on firm’s financial performance while measures by ROA, but not by Tobin’s Q. The study also finds that the nationality of directors and independent board membership is found to have no significant influence on firms’ financial performance. This study has implications on the business firms to develop the strategic guidelines of board composition to ensure the effectiveness and profitability of their companies

scholarly journals The Influence of the Independent Non-Executive Board Members on the Financial Performance of the Companies Listed in the Bucharest Stock Exchange

2021 ◽  
Vol 14 (10) ◽  
pp. 462
Author(s):  
Bogdan Aurelian Mihail ◽  
Carmen Daniela Micu
Keyword(s):  
Financial Performance ◽  
Stock Exchange ◽  
Relevant Literature ◽  
Board Members ◽  
Return On Equity ◽  
Point Increase ◽  
The Board Of Directors ◽  
Governance Tools ◽  
Scatter Plots ◽  
The Impact

This paper studies the impact of independent board members on the financial performance of companies listed on the Bucharest Stock Exchange during the period 2016–2020. Different characteristics of the board of directors have been examined extensively in the literature and board independence was identified as one of the most effective corporate governance tools. In this context, the present study contributes to the relevant literature by examining recent data for Romania and investigating alternative performance indicators such as return on assets (ROA), return on equity (ROE) and Tobin’s Q. The correlation analysis, scatter plots, and regression results document that a higher share of the independent board members was associated with higher returns on equity ratio. Specifically, a 10% rise in the share of independent members was associated with an approximately 0.9%-point increase in ROE.

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