Corporate Governance and Performance of Indian Firms: The Effect of Board Size and Ownership

Springer Science and Business Media LLC - 2005
Neeraj Dwivedi1, Arun Kumar Jain2
1Department of Strategic Management, Indian Institute of Management, Kozhikode, India
2Department of Strategic and International Management, Indian Institute of Management, Lucknow, India

Tóm tắt

The paper reviews international literature on corporate governance and firm performance and investigates the relationship in the Indian context, taking into account the endogeneity in the relationship. Governance parameters include board size, directors’ shareholding, institutional and foreign shareholding, while the fragmentation in shareholding is captured by public shareholding. A simultaneous equation regression model for Tobin’s Q, as a measure of firm performance, is attempted using these variables, while controlling for industry effects and other non-governance variables. The data corresponds to a panel of 340 large, listed Indian firms for the period 1997–2001 spread across 24 industry groups.

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