Corporate Boards in some OECD countries: Size, composition, functioning and effectiveness

Pablo de Andrés Alonso, Valentín Azofra Palenzuela () and Félix López-Iturriaga ()
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Valentín Azofra Palenzuela: Departamento de Economía Financiera y Contabilidad, Facultad de Ciencias Económicas y Empresariales, Universidad de Valladolid, http://www2.eco.uva.es/conta/

No 2000-10, Documentos de Trabajo "Nuevas Tendencias en Dirección de Empresas". Working Papers "New Trends on Business Administration". from Interuniversitary Doctorate Program "New Trends on Business Administration", Universities of Valladolid, Burgos and Salamanca (Spain). Programa de Doctorado Interuniversitario "Nuevas Tendencias en Dirección de Empresas", Universidades de Valladolid, Burgos y Salamanca (España).

Abstract: In recent years, the debate about the efficiency of corporate governance mechanisms has focused on the activity of corporate boards of directors. This paper joins this debate by analyzing the effect of board size, composition and structure on firm value in a sample of 450 non-financial companies from ten Western Europe and North American countries. The econometric method combines uniequational regression analysis with simultaneous equations in order to control for the possibility of board size and composition endogeneity. The results show a negative relationship between firm value and the board of directors size. This relation holds when we control for alternative definitions of firm size and for board composition, board structure, country effect and industry effect. We find no significant relationship between outside directors and firm value. These results are consistent, in an international framework, with previous relevant papers.

Keywords: Corporate governance; board of directors. (search for similar items in EconPapers)
JEL-codes: G32 G34 (search for similar items in EconPapers)
Date: 2000-12
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Published in Corporate Governance: An International Review, vol. 13, no. 2, 20005, pages 197-210.

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