Influence of Board Characteristics on Financial Performance of CNX Nifty Listed Companies in India
Keywords:
Size of Board, Board Education, Board Nationality, Women Director, Return on AssetsAbstract
The aim of this research work is to analyze the influence of board characteristics on the financial performance of the CNX Nifty Listed Companies in India. We examined board characteristics such as the size of the board, Independence, Duality, Gender, Education, Nationality, Board Meeting, Age as the independent variables and leverage, size of the firm, age of the firm as control variables. Financial performance is measured in terms of Return on Assets. The study used 45 CNX Nifty listed companies for a period of 2010 to 2017. In all eleven hypotheses were posit. Using the GLS Random effect regression model. The study found a negative and insignificant relationship between the size of the board, Independent directors, Duality, board meeting, Gender, Nationality and Return on Assets. Whereas, board age, education had a positive, insignificant relationship with Return on Assets. But with regard to the size of the firm, leverage, there exists a negative and significant relationship with Return on Asset. The age of the firm also found to have a negative relationship with return on assets but statistically not significant. The research paper concludes stating that most of the firms under study are family owned and are highly controlled by promoter groups, most of the policy guidelines on corporate governance are either followed as a checklist or as a rule of thumb. Hence board characteristics are not influencing the financial performance.
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