Board structure composition and financial distress likelihood of Indian firms

Ammar Hafeez and Sujata Kar

International Journal of Management Practice, 2023, vol. 16, issue 1, 104-139

Abstract: This study based on a dataset of 363 BSE listed Indian firms, examines how the composition and structure of their boards, proxied by the corporate governance variables, impact the likelihood of financial distress. Ten variables representing different features of the board were undertaken. These include board size, independent directors, non-executive directors, CEO-chair duality, chair concurrent position, CEO concurrent position, presence of female directors, ownership structure, lineage and having family members on board. Financial ratios and other corporate governance variables were entered as control variables along with industry dummies. Results report that the variables, CEO chair duality, government-owned firms, chair concurrent position, and non-lineage firms reduce the financial distress likelihood. Our results are robust to multiple criteria of the financial distress measures. Moreover, they corroborate one of the important guidelines of the separation of CEO and chairperson positions, suggested by the Kotak Committee in 2017.

Keywords: financial distress; bankruptcy; board structure; Kotak Committee; corporate governance. (search for similar items in EconPapers)
Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.inderscience.com/link.php?id=127679 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ids:ijmpra:v:16:y:2023:i:1:p:104-139

Access Statistics for this article

More articles in International Journal of Management Practice from Inderscience Enterprises Ltd
Bibliographic data for series maintained by Sarah Parker ().