Ownership Structure, Board Composition and Investment Performance
AbstractIn this paper the relation between ownership structure, board composition and firm performance is explored. A panel of Swedish listed firms is used to investigate how board composition affects firm performance. Board heterogeneity is measured as board size, age and gender diversity. The results show that Swedish board of directors have become more diversified in terms of gender. Also, fewer firms have the CEO on the board which can be interpreted as a sign of increased independency. The regression analysis shows that gender diversity has a small but negative effect on investment performance, and the same holds for CEO being on the board. The analysis also show that board size has a significant negative effect on investment performance. When incorporating all the explanatory variables into one equation however, the negative effect of larger boards dilutes the effect of gender diversity and having the CEO on the board.
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Bibliographic InfoPaper provided by The Ratio Institute in its series Ratio Working Papers with number 129.
Length: 26 pages
Date of creation: 13 Feb 2009
Date of revision:
Contact details of provider:
Postal: The Ratio Institute, P.O. Box 5095, SE-102 42 Stockholm, Sweden
Phone: 08-441 59 00
Fax: 08-441 59 29
Web page: http://www.ratio.se/
More information through EDIRC
Corporate governance; board composition; investments performance; marginal q;
Other versions of this item:
- Eklund, Johan & Palmberg, Johanna & Wiberg, Daniel, 2009. "Ownership Structure, Board Composition and Investment Performance," Working Paper Series in Economics and Institutions of Innovation 172, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
- G30 - Financial Economics - - Corporate Finance and Governance - - - General
- L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
- L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-02-22 (All new papers)
- NEP-BEC-2009-02-22 (Business Economics)
- NEP-CFN-2009-02-22 (Corporate Finance)
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