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Board Structure and Firm Performance: Evidence from French Firms Listed in SBF 120

Aymen Ammari (), Mohamed Kadria () and Abderrazak Ellouze
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Abderrazak Ellouze: Higher School of Digital Economy, University of Manouba, Tunisia.

International Journal of Economics and Financial Issues, 2014, vol. 4, issue 3

Abstract: Using a sample of 40 French companies listed on the SBF 120 for the period 2002-2009, we examine if board structure (board size, independence of its members andthe cumulativefunctions of decision and control) relate to their performance. To test the validity of our hypothesis,which states the existence of a certain deterministic between the board structure and financialperformance measured by four different ratios, namely ROA, ROE, Tobin's Q and Market to Book, we have developed four dynamic panel system GMM approach to control for relevant sources of endogeneity (simultaneity, reverse causality and unobserved heterogeneity). Our results support the idea, commonly accepted, that board structure is a determinant factor for French firm performance.

Keywords: Board of Directors; board size; independence of the board; accumulation of functions; financial performance; system GMM. (search for similar items in EconPapers)
JEL-codes: G30 G34 J44 L25 (search for similar items in EconPapers)
Date: 2014
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