Board Of Director Characteristics Research Articles

BOD characteristics and their impact on the link between ESG disclosure and integrated reporting disclosure quality: a study of Egyptian non-financial firms

AbstractThis study examines the impact of environmental, social, and governance (ESG) disclosure on integrated reporting disclosure quality (IRDQ) and the moderating role of board of directors (BOD) characteristics. Prior research on ESG disclosure and IRDQ has been limited, especially in emerging economies like Egypt. Furthermore, the influence of BOD attributes has been underexplored. This study aims to address these gaps. A sample of 34 Egyptian non-financial companies under ESG disclosure mandates from 2015 to 2021 is analyzed using regression analysis. The results show a significant positive association between ESG disclosure and IRDQ. Furthermore, BOD gender diversity and size are found to positively moderate the ESG–IRDQ relationship. These findings highlight that appointing more women on boards and increasing board size can improve IRDQ when firms engage in ESG disclosure. However, the small sample size of ESG-mandated companies and inherent limitations in constructing disclosure indices constrain the generalizability of results. Overall, this study provides timely empirical evidence on ESG adoption within the unique Egyptian context and its influence on integrated reporting (IR). It contributes to literature by identifying specific BOD characteristics that enhance IRDQ. The results offer practical insights into how companies, regulators, and stakeholders can leverage board diversity and size as well as ESG disclosure to improve IRDQ.

Creating value through diversity: Analysis of the strategic management of BoD diversity in favor of sustainable performance

AbstractIn this article, we explore the impact of the characteristics of the Board of Directors (BoD) on environmental, social, and governance (ESG) performance for European listed companies and its evolution during the period 2018/2021. The purpose of this study is to understand if and how the BoD characteristics influence the ESG performance of the major listed companies in the EU before and after the COVID‐19 breakthrough. The COVID‐19 pandemic is taken as a reference point in time, considering that several studies show that, even in a health crisis with economic repercussions for the whole world, companies have continued to increase their commitment to ESG practices. The sample is composed of 600 European listed companies and covers the period from 2018 to 2021. The ESG score and the other variables are collected for all companies included in the STOXX 600 index (from the Refinitiv Workspace database) and analyzed using the ordinary least square (OLS) panel regression analysis at country and industry level covering the period 2018–2021. The results of our analysis show no significant relationship between BoD characteristics (in terms of gender diversity, cultural diversity, and special skills) and ESG performance in the pre‐COVID‐19 era. In the post‐COVID‐19 era, gender diversity is the only characteristic of the BoD, among those investigated, capable of influencing nonfinancial performance. This result, in line with the resource density theory, is justified by the increase in the average number of women in the BoD in the two‐year period 2020–2021 compared to the previous one (2018–2019). We offer theoretical and practical implications to enhance ESG performance by combining BoD characteristics. We finally contribute to enhance the debate on the relevance of the BoD characteristics and ESG performance relationship providing consistent findings to emphasize the quality of the BoD for the ESG reporting and performance.

How to improve the financial performance of Islamic banks in the MENA region? A Shariah governance perspective

PurposeThe purpose of this study is to investigate the impact of Shariah Advisory Board (SAB), Audit committee (AC) and board of directors (BD) characteristics on the performance of Islamic banks (IBs) in the MENA region.Design/methodology/approachThe paper employs a quantitative approach, utilizing both ordinary least squares (OLS) regression and panel data analysis (random effects models) to examine the relationship between corporate governance variables and the performance of IBs. The sample consists of 50 IBs from 10 countries, spanning a seven-year period (2010–2016), with the exclusion of the Covid-19 pandemic period. To ensure the robustness of the results, various sensitivity tests were conducted, including pooled regression OLS and subsample analysis based on adhering to the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) standards.FindingsThe study's findings suggest that the size of the SAB and the membership of at least one member of the SAB on the AAOIFI have a notable adverse effect on the performance of IBs. On the other hand, the AC independence has a positive influence on bank performance. However, there was no significant impact observed for AC size, meeting frequency and BD characteristics on bank performance. The research also revealed nuanced relationships between governance variables and bank performance when analyzing the sample based on AAOIFI adoption. Among banks not adhering to AAOIFI standards, SAB size and CEO duality negatively affected return on assets, while AC independence positively impacted it. For AAOIFI-compliant banks, AC independence significantly improved bank performance, whereas AC meetings exhibited a negative effect. Furthermore, there were no significant relationships observed for return on equity among banks not adhering to AAOIFI standards, whereas AAOIFI-compliant banks experienced positive impacts from AC independence. These results offer valuable insights into the intricate connection between governance attributes and bank performance, particularly in the context of AAOIFI standards adoption.Practical implicationsThe study's findings have important practical implications for various stakeholders in the Islamic banking industry. For bank practitioners and management, the study highlights the significance of enhancing the independence of AC to improve decision-making and risk management, leading to better bank performance. Moreover, careful selection of SAB members can mitigate potential negative effects on performance. Policymakers may consider promoting AAOIFI standards to shape the relationship between governance and bank performance. Investors can use the insights to make informed decisions, and banks with stronger governance may attract more investments.Originality/valueThrough quantitative analysis and AAOIFI-based sample division, this study adds to the growing literature on corporate governance and the performance of IBs by examining the impact of multiple corporate governance variables on the performance of IBs in the MENA region. To provide a theoretical basis for this relationship, three theories, namely agency, stewardship and stakeholder theories, are employed and discussed.

Effect of Board of Directors Size, Board of Directors Characteristics, Ownership Structure, and Company Size on The Quality of Sustainability Reporting Disclosures

This study aims to analyze the quality of Sustainability Reporting disclosures and test the factors that influence them. The quality of Sustainability Reporting disclosures is identified using content analysis techniques based on the GRI Standards. GRI Standards is the latest guideline launched by the Global Reporting Initiative which became effective in 2018 in Indonesia. Factors influencing the quality of Sustainability Reporting disclosures were tested using quantitative methods of multiple regression analysis. This study used 36 samples obtained through purposive sampling from infrastructure sector companies listed on the Indonesia Stock Exchange that disclosed sustainability reporting for the 2016-2021 period. The results showed that the quality of sustainability reporting in Indonesia is still relatively low at 17.41%. This implies that voluntary sustainability reporting disclosures make companies less motivated to make in-depth disclosures. The number and characteristics of the company's board of directors have a significant influence and the ownership structure and size of the company have a significant positive influence on the quality of sustainability reporting.

Impact of the board of directors’ characteristics on firm performance: A case of Bahraini listed firms

This study aims to examine the impact of the characteristics of the board of directors (BOD), namely board independence, board size, frequency of board meetings, and board gender diversity, on firm performance. This quantitative study uses data from all firms listed in the Bahrain Bourse for 2019 and 2020. Data on BODs were taken from the companies’ governance reports, while data on firm performance, namely return on assets (ROA), return on equity (ROE), and earnings per share (EPS), were taken from annual reports. Based on the ordinary least squares (OLS) approach, the results show insignificant relationships between BOD characteristics and firm performance. Board independence, size, frequency of meetings, and gender diversity insignificantly enhance Bahraini firms’ performance. The results indicate that firms may need to effectively implement BOD mechanisms. Moreover, other factors may moderate the impact of BOD mechanisms on firm performance. Hence, the study suggests a need for more regulations and policies to increase the effectiveness of board members. This study alerts policymakers, firms’ shareholders and stakeholders, and researchers to the need to increase directors’ roles in boosting company performance, especially in developing countries, where it is complicated to force business to follow best governance practices.

Can Board Diversity Promote Dividend Policy? Seeking The Role of Profitability

This study investigates the effect of the board of directors (BOD) diversity on dividend policy and how the implications of profitability are treated as moderation. Dividend policy and BOD characteristics have been studied extensively; however, the profitability role being moderating variable and BOD diversity are challenging. To the best of the authors' knowledge, this study is one of the first to examine profitability as moderation. BOD diversity includes gender, age, education level, accounting expertise, and nationality. The research period spanned 2017-2020, where the number of samples was 370 companies listed on the Indonesia Stock Exchange, resulting in 1,480 data. The regression model used is panel data. Overall, BOD gender, education level, and nationality are homogeneous, where female directors, directors with master's education, and foreign directors have a small proportion. As a result, they have no significant effect in promoting dividends. In addition, profitability cannot influence the relationship between board gender and board nationality on dividends. Nevertheless, profitability moderates the relationship between board nationality and dividend policy to a significant negative. Further, board age and accounting expertise positively and significantly affect dividend policy, and the results are identical when moderated by profitability. The proportion of board expertise expressed is heterogeneous, and the board age of 52 years is categorized as old, while they mitigate agency conflict. Thus, companies are required to maintain these proportions. However, companies must remedy the recruitment system to accommodate more female directors, directors with higher education at the master's level, and foreign directors. The government must also refer to regulations in developed and developing countries that establish a minimum quota for the presence of female directors.

The Impact of Board Characteristics on Earnings Management Practices Through Real Activities: Evidence from The Egyptian Environment

This research aims to demonstrate the relationship between the board of directors’ characteristics and the practices of real earnings management in the companies operating in the market. results: The existence of a statistically significant relationship between the board of directors characteristics and earnings management with real activities through sales, the existence of a statistically significant relationship between the board of directors characteristics and real earnings management activities through production, the necessity of establishing the National Authority for Governance of Business and Governmental Establishments with the aim of eliminating financial, administrative, economic and political corruption at the level of The state.

The mediating role of operating performance on the association between BOD features and firm financial performance. An Applied Study on the Egyptian Stock Market

Purpose: This paper examines the influence of operating performance as a mediator variable on the relationships between the various characteristics of the Board of directors and firms' financial performance, as measured by return on average total assets and the ratio of Earning per ordinary share, for nonfinancial firms listed on the Egyptian stock market. Methodology: A multiple regression analysis and path analysis are performed to explain the four models employed for a sample of (26) non-financial Egyptian firms from 2018 to 2021. Five principal hypotheses are examined, HO1: there is no statistically significant influence at the level of significance (a ≤ 0.05) for the Board of Directors’ characteristics on EPS. HO2: there is no statistically significant influence at the level of significance (a ≤ 0.05) for the Board of Directors’ characteristics on ROA. HO3: there is no statistically significant influence at the level of significance (a ≤ 0.05) for the characteristics of the Board of Directors on ATO. HO4: there is no statistically significant influence at the level of significance (a ≤ 0.05) for the characteristics of the Board of Directors on OPM. H05: operational performance has no significant impact on the relationship between the Board of Directors’ characteristics and firm financial performance measured by ROA and EPS. Findings: Consistent with the majority of prior research, this study's findings indicate that Board of director characteristics have a positive, significant influence on firm financial performance during the study period. Additionally, BOD characteristics affect operating performance in a positive direction, particularly asset turnover. In addition, a path analysis reveals that operating performance acts as a positive mediator in this relationship.

Do the characteristics of the board chairman have an effect on corporate performance? Empirical evidence from Saudi Arabia

The purpose of this study is to investigate the impact of corporate governance, especially the characteristics of the chairman of the board of directors (BC) (tenure, expertise and directorships) on corporate performance (CP). It was conducted with data from the 44 companies registered in the financial sector on Bursa, Saudi Arabia, from 2015 to 2019, eventually totalling 195 firm-year observations. The results indicate that the BC’s tenure and expertise are positively associated with the financial firm’s performance. The attribute of multiple directorships held by the BC, on the other hand, has no relationship with corporate performance. The results help policy makers better understand BC characteristics, which can be incorporated into future policy to ensure the protection of shareholder investment and the interests of various stakeholders. The results may also be useful to legislators seeking to improve BC efficiency, overall corporate governance and investor confidence in the organization. To the researcher’s knowledge, the relationship between CP and BC characteristics has not been investigated, even although the chairman is in charge of appointing directors who could expand the company and make contributions not only to the board but also to CP (Owen & Kirchmaier, 2008). Therefore, this article contributes to the limited literature on the impact of BC characteristics on CP in the context of Saudi Arabia.

Corporate governance: association the spots between institutional enhancement, organisational modification and earnings quality

PurposeThe purpose of this paper is to explore the link between earnings quality, Audit Committees and the Board of companies located in Jordan through the lens of enhancing corporate governance.Design/methodology/approachThe real earnings management (REM) and accruals earnings management models were notably used within the panel data robust regression analysis approach; these were used against certain Audit Committee characteristics (i.e. meeting frequency, amount of Board and Committee participants [both internal and external], size) and Board of Directors.FindingsThe former characteristics were found to have a positive relationship with REM, while the latter yielded mixed results: while there was no significant identifiable relationship between Board outsiders and REM, there was a positive relationship identified between Board meetings, Board insiders and Board size and REM. In regard to this study’s limitations, the qualitative data gathered for the Board of Directors through the lens of corporate governance enhancement should have been documented with more detail; furthermore, the study was limited to the study of just one nation.Research limitations/implicationsThe data is limited to only a single country. More explanation for Board of Directors need qualitative understandings into corporate governance improvement. The control variables are essentially partial in a developing market context.Practical implicationsThe different corporate governance code and guidelines improvements have varied influence on earnings quality. As predictable, boards of directors most effect on earnings quality. Improvements have included most modification to audit committees but through them slight measured effect on earnings quality.Social implicationsJordan’s corporate governance improvements expected organised corporate governance practices generally in place amongst its boards, and though invoking considerable modification to audit committees, eventually included slight modification to earnings quality. However, both improved earnings quality.Originality/valueThis particular research appears to be the first to consider both Audit Committee and Board of Directors characteristics in one model; indeed, in this vein, this research is also the first to explore the corporate governance enhancements that initially stemmed from there being zero code or guideline regarding its use, despite it becoming required recently. Hence, the authors can say this study has high originality.

Bank Performance and Board of Directors Characteristics in the Context of Bangladeshi Islamic Banks

Bank Performance and Board of Directors Characteristics in the Context of Bangladeshi Islamic Banks

Pengaruh Faktor-Faktor Keuangan dan Board Of Directors Characteristics Terhadap Nilai Perusahaan

Abstract
 The purpose of this study was to examine the financial factors and board of directors characteristics on firm value. This research was conducted to obtain an overview of financial and non-financial factors influencing the value of the company during the Covid- 19 pandemic. The population of this study is Kompas 100 Index companies members for the 2019-2020 period, with a final sample of 72 companies. This study uses secondary data, and multiple linear regression analysis techniques. The results of this study show that Profitability and Board Meetings have a positive influence on firm value, while Company Size, Capital Structure, Board Independence, Board Size, and Gender Diversity have no effect on Firm Value and CEO Duality is only slightly present in Indonesia because Indonesia adheres to a two-tier system. 
 Keywords: Firm Value, Financial Factors, and Non-financial Factors 

Board Characteristic and Financial Restatement

This study explores the role of board characteristics, namely the Board of Directors (BoD) and the Board of Commissioners (BoC), on the possibility of financial restatement. BoD characteristics were analyzed based on BoD size, female, and overconfidence. Meanwhile, BoC characteristics were analyzed based on BoC size and independent BoC. The population is all manufacturing companies on the Indonesia Stock Exchange for the 2017- 2019 period. Determination of the sample using the purposive sampling method. The number of samples used is 32 manufacturing companies or 96 observational data. This study using logistic regression to hypotheses testing. The results showed that two variables, namely female of BoD and independent of BoC, reduced the possibility of financial restatement. However, three other variables, including BoD overconfidence, BoD size, and BoC size, do not affect the possibility of financial restatement.DOI: 10.26905/jkdp.v25i3.5883

Board of Director Characteristics, Institutional Ownership, and Accounting Conservatism

One of the determinants of conservatism is the characteristics of the board of directors. Several studies have examined the relationship between board characteristics and accounting conservatism. Nonetheless, previous empirical findings show heterogeneous and inconclusive results. This study aims to prove the role of board characteristics, namely board size, board female, and board overconfidence, in accounting conservatism. This study also explores the role of institutional ownership in moderating the board characteristic relationship and accounting conservatism. This research was conducted on 123 manufacturing companies for three observation periods, namely 2017-2019. The sampling method used purposive sampling. The data analysis technique used is Partial Least Square. The test results prove that board size and board female increase accounting conservatism, while board overconfidence reduces conservatism. The study results also indicate that institutional ownership can strengthen the relationship between board size and board female to accounting conservatism. Contrary, institutional ownership failed to moderate the relationship between board overconfidence and accounting conservatism.

Strive towards investment efficiency among Egyptian companies: Do board characteristics and information asymmetry matter?

AbstractThis study examines the impact of the board of directors (BoD) characteristics, namely BoD independence, compensation, leadership, and CEO career concerns on investment efficiency, using information asymmetry as a mediator. Using a sample of 326 firm‐year observations of non‐financial firms listed in the EGX 100 Index of the Egyptian stock market from 2014 to 2018, we find that board independence, board compensation, and board leadership are negatively associated with inefficient investment and information asymmetry, whereas the opposite is true for CEO career concerns. Furthermore, a positive relationship between information asymmetry and inefficient investment is documented. Finally, we find that information asymmetry mediates the relationship between the three BoD characteristics (i.e., board independence, leadership, and compensation) and inefficient investment. Conversely, it does not interfere with the relationship between CEO career concerns and inefficient investment. These findings are consistent in both under‐investment and over‐investment scenarios and across the pooled sample. Our findings contribute to corporate governance and investment literature by addressing new relationships, providing empirical evidence from a one‐tier board model in developing countries, and offering a useful explanation for the inconsistent results in prior studies. These findings help regulators, investors, and policymakers realize the importance of BoD characteristics in mitigating information asymmetry and improving corporate investment efficiency.

Board of Directors and CEO’s Compensation: The Case of Listed European Firms

The aim of this research is to assess the role of the board of directors in determining CEO’s compensation in the context of listed European companies for 3 fiscal years (2016-2017-2018). Based on a sample extracted from 11 European countries (France, Belgium, Germany, Italy, Spain, Ireland, Sweden, Denmark, Finland, United Kingdom and Netherlands), the results reveal the importance of board of directors characteristics in determining of CEO’s compensation. The board size, CEO duality, the presence of independents directors and the existence of compensation committee have been shown as determinants of CEO’s compensation.

Do Boards of Directors Really Matter in the Cooperation Behavior of Firms? An Exploratory Analysis in Spain

This paper explores the relationship between one of the major aspects of the internal mechanism of corporate governance, i.e., the board of directors, and the corporate strategy of cooperation. The study was designed to investigate whether certain board of director characteristics have an influence on the propensity to cooperate in Spanish listed non-financial firms. Our findings reveal that the propensity to cooperate in Spanish firms is driven more by a tight “management effect” whereby the highest probability of occurrence is related to firms with duality on their boards and a lower proportion of nominee directors representing controlling shareholders. This paper adds evidence to the corporate governance-corporate strategy (alliance propensity) discussion in a continental country such as Spain.

The Board of Directors Characteristics and Timeliness of Annual Financial Reporting for Jordanian Commercial Banks

This study aims at investigating the relationship between the board of directors’ characteristics, such as (the board of directors’ size, board of directors’ meetings, board of directors’ independency, and the academic qualification for its members), and the timeliness of issuance of annual financial reports in Jordanian banks. The study adopted descriptive analytical approach whereas the population of the study in overall Jordanian banks achieved 16 banks during the study period between 2010-2017 i.e. this study lasted eight years while the number of viewers reached 128 viewer. A number of statistical methods for data analysis were used such as descriptive statistics (mean, standard deviation, maximum values and minimum values), and logistic regression analysis was used in testing study hypothesis. The findings revealed the compliance of Jordanian banks within the required timetable Securities Commission was intermediate. Also, there is a positive relationship between the board of directors’ size, the board of directors’ independency and the timeliness of issuance of annual financial reports. In addition, there is no relationship between the board of directors’ independency, the academic qualification for its members, and the timeliness of issuance of annual financial reports.

Board of directors characteristics and disclosure practices of corporate social responsibility: a comparative study between Brazilian and Spanish companies

Purpose The purpose of this paper is to verify if the characteristics of the board of directors (BD) affects the disclosure practices of corporate social responsibility (CSR). Two different population samples were used from the period 2008-2011: Brazilian listed companies and Spanish companies. It is observed that the size of the board positively affects CSR disclosure practices of the two groups of companies. The percentage of independent directors of the board members positively affects the disclosure practices of CSR in Spanish companies. The percentage of participants of the board women positively impacts the disclosure practices of CSR in Brazilian companies. Design/methodology/approach The authors worked with two different population samples: one, composed by the Brazilian listed companies in BM&FBOVESPA and other by Spanish companies listed on Madrid Stock Exchange. The selection of this period was due to the increase in the adoption of GRI guidelines from 2008 (Prado-Lorenzo et al., 2012). In addition, as Spanish companies disclose more CSR reports according to the GRI guidelines (Global Reporting Initiative, 2012), this is a suitable environment for the analysis. Findings Regarding the research question of this study, it was found that the profile of the board affects the disclosure practices of CSR of Brazilian and Spanish companies. The size of the board positively affects CSR disclosure practices of the two groups of companies. The percentage of independent directors of the board members positively affects the disclosure practices of CSR in Spanish companies. The percentage of participants of the board women positively impacts the disclosure practices of CSR in Brazilian companies. Research limitations/implications Both the BD of Spanish companies as the Brazilian still requires the participation of a greater number of women. It is important to remember that the variable that represents women in the board presented a positive impact on the dependent variables, and it is statistically significant, so it is possible to affirm that when a large number of women are on the Board, the company tends to disclose more standardized information about CSR practices. These results are in line to other empirical analysis that defend that women usually introduce more philanthropic worries (Ibrahim and Angelidis, 1991) and tend to provide higher information transparency, especially about sustainability issues (Barako and Brown, 2008; Prado-Lorenzo and García-Sánchez, 2010; Frías-Aceituno et al., 2012). Practical implications This research should benefit, in this sense, investors, managers and policymakers, civil society representatives and corporate managers themselves active in the two economies investigated. Social implications It should be noticed that both Brazil and Spain use to encourage joint research between researchers of Brazilian and Spanish universities, funding projects developed in partnership as Cooperation Programme signed in 2001 by the Ministries of Education in both countries. Thus, it is justified the choice of Spain for its comparative analysis due to the need for more field studies on this topic in both countries, and also that it has been promoted by their governments. Originality/value It is expected that the results of this research contribute to the identification of relevant factors in disclosure of corporate environmental policies and actions that may be useful in the decision-making process of various stakeholders. Such identification will also allow us to identify possible relationships between environmental initiatives, the profile of BD.

Mediating Effect of Tax Management on the Relationship Between Board of Directors Characteristics and Firm Performance

This study aims at examining the mediating effect of tax management on the relationship between certain board characteristics including independence, gender diversity, and activeness and firm performance. The sample of the study includes 135 companies in the industrial and service industries listed with Amman Stock Exchange in 2008–2017. This study selects purposive samples using the panel data technique. Results indicate that first, tax management mediates the board independence relationship with financial performance. Second, tax management does not mediate the board gender diversity and board activities relationships respectively with financial performance.