Institutions, board structure, and corporate performance: Evidence from Chinese firms

Tao Chen

Journal of Corporate Finance, 2015, vol. 32, issue C, 217-237

Abstract: This paper investigates how institutional environment like property rights protection influences the size and composition of corporate boards, and further, how board structure impacts firm performance in China. Using a World Bank survey of 2400 public and private firms across 18 Chinese cities, I find robust evidence that weaker helping hand from the government is associated with a higher number and proportion of outsiders on the board, after controlling for the effects of firm complexity, growth opportunities, CEO characteristics, ownership, and the potential endogeneity concern. Furthermore, the results show that when firms are operating in a weak property rights environment, more outsiders improve corporate performance.

Keywords: Corporate governance; Property rights; Institutions; Board size; Board composition; Corporate performance (search for similar items in EconPapers)
JEL-codes: G3 G34 K22 P3 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:32:y:2015:i:c:p:217-237

DOI: 10.1016/j.jcorpfin.2014.10.009

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