A comparative review of corporate-governance literature: evidence from NASDAQ and NYSE companies

In this review, we survey the literature on board independence, with particular emphasis on the long-term effects of the United States Securities and Exchange Commission’s 2003 board-independence mandate. Grounded in agency theory, the mandate was introduced to strengthen board oversight and improve operating performance following a series of major corporate scandals. Although board independence is widely promoted as a mechanism for aligning managerial behavior with shareholder interests, empirical studies have produced mixed evidence regarding its effectiveness, with outcomes often varying across firms and regulatory environments. To examine these dynamics more closely, we highlight a series of studies that provide a rigorous empirical evaluation of the mandate’s impact on firms listed on NASDAQ and NYSE. The review emphasizes the conditional nature of board-independence reforms and the roles of enforcement mechanisms and firm characteristics in shaping governance outcomes. These findings suggest that governance policies may be more effective when they account for institutional differences and firm-specific conditions rather than relying solely on uniform structural mandates.