Board Size and Corporate Performance: An Empirical Investigation
Published: 2013
Author(s) Name: Shivan Sarpal, Fulbag Singh |
Author(s) Affiliation: Commerce and Business Management Department, Guru Nanak Dev University, Amritsar, Punjab, India
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Abstract
The subject of corporate governance has always been of keen interest to the researchers in the area of management and
finance. This paper basically concentrates on the corporate board of directors which is an internal corporate governance mechanism. Since the
effectiveness of boards counts on several characteristics such as board size, board composition, leadership structure etc, therefore considering
this viewpoint, the present study is based on the analysis of board size of BSE listed companies in India. This analysis broadly embraces the
relationship between board size and performance as represented by various indicators such as Operating Profit Margin, Return on Assets,
Return on Equity, Earnings per Share and Tobin’s Q. Spearman’s rho correlation, One Way ANOVA and Kruskal-Wallis tests were applied to
draw the inferences. Results of the study remained robust and thus concluded that both board size and firm performance were independent of
each other as board size was not found to be associated with firm performance.
Keywords: Corporate Governance, Board Size, Firm Performance
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