Board diversity and financial performance: empirical evidence from the United Kingdom

Purpose This study aims to investigate the relationship between board diversity and financial performance from a wide perspective, including multiple dimensions of board diversity. Design/methodology/approach The cross-sectional design of the FTSE 350 companies in the period of 2013–2019 was adopted in this study. Data were collected using the Thomson Reuters Eikon and BoardEx databases and analyzed via ordinary least Squares (OLS) regression. Findings Both gender and skill diversity positively affect financial performance. However, other dimensions of diversity, including board tenure, education and network, have no significant influence on financial performance. On the other hand, nationality diversity negatively affects financial performance, and the gender diversity of executive directors negatively affects market-based performance. The results remain unchanged after considering endogeneity concerns and using alternative measures of financial performance. Practical implications This study provides useful insights into the importance of board diversity and its implications for firm performance, which can help in the development of future regulations and policies, such as female representation on the board. The findings can also guide companies toward the best way of diversifying their boardrooms in different aspects. Originality/value This study extensively investigates board diversity, including gender, tenure, skill and education, network and nationality, using the lens of the resource dependency theory. It also extends the scope of the study to examine some characteristics of executive directors, including gender and age. The evidence is provided from one of the leading countries in regulating corporate governance (CG), i.e. the UK.

Open Innovation and Competitive Advantage on the Hospitality Sector: The Role of Organizational Strategy

This paper assesses the relationship between open innovation and competitive advantage and the mediating effect of organizational strategy. Using a quantitative methodological approach with survey data from 251 Portuguese hotel executive directors’ small and medium-sized enterprises (SMEs), this research adopted a quantitative methodological approach, thereby conducting an exploratory and transversal study. Findings show that (1) open innovation influences organizational strategy and (2) organizational strategy enhances competitive advantage. Moreover, the results also highlight that (3) organizational strategy has a mediating effect between open innovation and competitive advantage. The paper provides relevant insights that will lead the firms’ top managers to design and implement strategies and define effective government policies, programs, and incentives to support the development of the firms’ open innovation model in the hospitality sector considering the new smart society and smart cities growing environment.

OVE’s Validation Methodology: IDB Group's Evaluation Recommendations Tracking System (ReTS)

The IDB Group's ReTS is a monitoring system aimed at providing the Boards of Executive Directors of the IDB and IDB Invest with periodic information for decision-making on Bank and IDB Invest actions and progress in implementing the endorsed recommendations issued by OVE. Assessing to what extent recommendations have been addressed is essential for institutional accountability and learning.

Analisis Pengaruh Tata Kelola Perusahaan Dan Struktur Modal Terhadap Kinerja Perusahaan

This paper aims to examine the company's performance problems as measured by book or market value by analyzing the proportion of executive directors, proportion of independent directors, board size, female directors, audit committee meetings, institutional investors, and the company's capital structure. This study uses the company's assets and capital as control variables. The paper object consists of 382 companies excluding the financial sector listed on the Indonesia Stock Exchange from 2016 to 2020. The study used purposive sampling techniques in collecting the research data. Data is processed using multiple regression methods with SPSS and Eviews statistical applications. The results showed that executive directors, independent directors, female directors, audit committee meetings, and institutional investors had no significant effect on ROA or Tobin's Q. While the board size proved to have a significantly positive relationship to Tobin's Q but not significantly related to ROA. On the other hand, the capital structure proved to be significantly negatively associated with ROA but significantly positively related to Tobin's Q.

The Implications of Board Independence and Foreign Ownership on Audit Quality of Manufacturing Firms in Nigeria

This study investigated the implications of board independence and foreign ownership on audit quality of manufacturing firms in Nigeria. The specific objectives of the study are to examine the effects of board independence as well as foreign ownership on audit quality of manufacturing firms quoted in Nigeria. Secondary data were carefully collected from a total of fifty eight (58) quoted manufacturing firms in Nigeria for the period (2010 – 2018) and the binary model of regression (logit, probit and gombit) was properly used for hypotheses testing. The outcome reveals that board independence had a positive and insignificant influence on audit quality while foreign ownership had a positive and significant influence on audit quality. The study therefore recommends that composition of the board should be such that its function is not undermined and one of such ways is to have an appropriate mixture with non-executive directors. Also having foreign ownership could enhance audit quality given the different corporate cultures they may possess.

Research on the Effect of Executives as Audit Committee Members on Internal Control Weakness

The Audit Committee is a specialized agency under the Board of Directors, and supervising the company's internal control is one of its duties. This article takes the 2012-2017 Shanghai-Shenzhen A-share non-financial listed company as a research sample, focusing on the chairmen, CEOs, CFOs, board secretaries and executive directors other than the CEO, discussing the impact of their concurrent appointment as audit committee members on the arising, correction and repair of internal control weakness in listed companies. The study found that different types of executives who are concurrently members of the audit committee would lead the internal control weakness to different directions. In general, excluding some less significant results, executives concurrently serve as members of the audit committee could stimulate the arising of internal control weakness and promote the correction and repair of the existing internal control weakness of the listed company. This indicates that when a listed company does not have internal control weakness, its executive layer intervention will weaken the effectiveness of the audit committee's governance and induce the arising of internal control weakness. Conversely, when the company inherently has internal control weakness, the intervention will strengthen the effectiveness of the audit committee's governance, making the audit committee more effective in monitoring internal control weakness. In addition, an important finding is that the existence of the Secretary of the board among the members of the audit committee will limit the chairs’ role in promoting internal control deficiencies.

Independent Country Program Review Suriname 2016-2020

This Independent Country Program Review (ICPR) analyzes the IDB Group's country strategy (CS) and country program with Suriname during the 2016-2020 period. ICPRs assess the relevance of the Bank's CS and provide aggregate information on the program alignment and execution. If the available information allows it, ICPRs also report on progress toward achieving the objectives that the IDB Group established by the CS. This review by the Office of Evaluation and Oversight (OVE) is intended to provide the Boards of Executive Directors of the IDB and IDB Invest with useful information to analyze the country strategies submitted for their consideration.

The influencing power of apply and explain on capital structure

The paper investigated the suspension of Independent Non-Executive Directors (INEDs) stock options on corporate capital choices: Equity, retained earnings, long term borrowing and short term borrowing. The paper used a sample of 1250 non-financial Firm years from 2010 to 2019. The Ordinary Least Squares and the difference in difference method discovered that the firms' Leverage increased positively after the reform. In particular, the suspension of stock options impacts the high levels of long term borrowing in the "Apply and Explain" periods. The study submits that the suspension of stock options maximizes the independence of the INED on the executive Board and Subcommittees (Audit and Remuneration) to reduce the use of retained earnings and promotes the use of Long term debts in financing projects.

Effectiveness, Efficiency and Executive Directors’ Compensation Among Listed Companies in Malaysia

This paper examines whether or not there is any relationship between executive directors’ compensation and the effectiveness and efficiency ratios of non-financial companies in Malaysia. Two variables are used in this study as independent variables (IVs), that is, company effectiveness ratio (return on equity) and company efficiency ratio (asset turnover); and six control variables, that is, firm visibility, liquidity, profitability, working capital, firm net-worth, and leverage. The executive directors’ compensation is the dependent variable (DV). Data are collected from 360 observations (120 companies’ annual reports for 3 years). STATA software analysis is used to examine the collected data. The results show that company effectiveness is one of the determinants of executive directors’ compensation but not company efficiency. Firm visibility, firm net-worth, and profitability also have strong relationships with executive directors’ compensation. However, liquidity and leverage do not show any significant relationship with executive directors’ compensation in Malaysian listed companies. This study focuses on Malaysia during the period of 2012 to 2014 because Malaysia is one of the developing countries in Asia, and in 2010, the Malaysian economy exhibited strong signs of recovery from the global financial crisis. However, the period between 2012 and 2014 was a critical period for the Malaysian economy; the Ringgit experienced depreciation and was devalued by more than 40%, which negatively affected the Malaysian economy as a whole. In addition, this study examines new variables in the Malaysian context, that is, firm efficiency, firm visibility, and firm net-worth.

Parameters Influencing Citizens’ Levels of Satisfaction: Soft Indicators of ‘Good Governance’

Previous studies highlighted the importance of soft indicators (e.g., quantitative sociological survey) influencing citizen satisfaction towards municipal service quality. Citizen satisfaction assessments have raised concerns over numerous independent parameters such as gender, age, and education on satisfaction levels toward administrative performance. It is also crucial to underline that the application of sociological survey for improving service quality is not well understood by municipal officers or scholars. To obtain substantial combined multiple indicators of service quality, it seems rationale to reconnoitre numerous parameters of citizen satisfaction and quantitatively investigate impacts of independent variables (e.g., gender, age, education) on corresponding satisfaction levels by using some advanced statistical tools. In this sociological assessment, a targeted population was constructed of Bangkok Metropolitan administration (BMA) stakeholders (n = 38,500), which are as follows: -       Bangkok residents in 50 districts under the governance of BMA -       Board committee, executive directors and general staff of 27 BMA offices This multiple dimensional analysis sociological survey data indicates that gender, age, and education play some important roles in governing municipal citizen satisfaction levels. Overall, the knowledge of relationship between citizen satisfaction levels and independent parameters can enhance the service quality of municipal administration.