Director Characteristics and Firm Performance
AbstractThe traditional methodology examining optimal boards relates a simple board variable� (e.g., independence or board demography) to firm performance, however, ig- noring other board characteristics.� This paper investigates how the education and business� experience of directors affect firm� performance. The sample consists of 1,574 directorships from 224 listed firms� in Switzerland.� Using� OLS� and including control variables, the results show that graduates of minor Swiss universities are negatively related to Tobin’s Q, and industrial knowledge and Tobin’s Q are nega- tively� correlated if the firm� has more divisions.�� In� addition, director fixed effects (or unobserved characteristics) are significant, but improve the explanatory power of the models only by 5 percent.
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Bibliographic InfoPaper provided by Faculty of Business and Economics - University of Basel in its series Working papers with number 2011/11.
Date of creation: 2011
Date of revision:
Corporate governance: Board of directors; Director characteristics; Education and business experience;
Find related papers by JEL classification:
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-01-10 (All new papers)
- NEP-BEC-2012-01-10 (Business Economics)
- NEP-CFN-2012-01-10 (Corporate Finance)
- NEP-CSE-2012-01-10 (Economics of Strategic Management)
- NEP-EDU-2012-01-10 (Education)
- NEP-EFF-2012-01-10 (Efficiency & Productivity)
- NEP-HRM-2012-01-10 (Human Capital & Human Resource Management)
- NEP-LAB-2012-01-10 (Labour Economics)
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- Xu, Hongmei, 2013. "How much do the characteristics of independent directors and supervisory board members affect firm performance in China?," Discussion Papers of the Institute for Organisational Economics 12/2013, University of Münster, Institute for Organisational Economics.
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