TY - JOUR
T1 - Optimizing corporate governance
T2 - unraveling the interplay of board structure and firm efficiency
AU - Shabbir, Muhammad Farooq
AU - Danial Aslam, Hassan
AU - Oon, Elaine Yen Nee
AU - Amin, Aamir
N1 - Publisher Copyright:
© 2024 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.
PY - 2024/11/1
Y1 - 2024/11/1
N2 - This study investigates the relationship between board characteristics and firm efficiency in emerging Asian economies, using stochastic frontier analysis and a panel dataset of 5829 firm-year observations. The results suggest that companies with strong monitoring boards concerning diversity, size, and independence achieve higher efficiency. This study provides more specific results on the importance of board characteristics for firm-level governance and highlights the Asian emerging markets’ focus on good governance practices. The study’s use of firm efficiency as a proxy for performance is a unique framework that mitigates endogeneity issues common in corporate governance variables. This approach is an improvement over previous research that has relied on financial ratios, which need to consider the value of management’s actions and investment decisions affecting future performance. The results contribute to the literature on corporate governance and provide valuable insights for investors in emerging markets.
AB - This study investigates the relationship between board characteristics and firm efficiency in emerging Asian economies, using stochastic frontier analysis and a panel dataset of 5829 firm-year observations. The results suggest that companies with strong monitoring boards concerning diversity, size, and independence achieve higher efficiency. This study provides more specific results on the importance of board characteristics for firm-level governance and highlights the Asian emerging markets’ focus on good governance practices. The study’s use of firm efficiency as a proxy for performance is a unique framework that mitigates endogeneity issues common in corporate governance variables. This approach is an improvement over previous research that has relied on financial ratios, which need to consider the value of management’s actions and investment decisions affecting future performance. The results contribute to the literature on corporate governance and provide valuable insights for investors in emerging markets.
KW - Board characteristics
KW - board index
KW - Business, Management and Accounting
KW - Corporate Finance
KW - Corporate Governance
KW - Economics
KW - efficiency
KW - emerging markets
KW - Finance
KW - Financial Management
KW - shareholder’s rights
UR - http://www.scopus.com/inward/record.url?scp=85202869788&partnerID=8YFLogxK
U2 - 10.1080/23322039.2024.2396034
DO - 10.1080/23322039.2024.2396034
M3 - Article
AN - SCOPUS:85202869788
SN - 2332-2039
VL - 12
JO - Cogent Economics and Finance
JF - Cogent Economics and Finance
IS - 1
M1 - 2396034
ER -