Economics & Sociology

ISSN: 2071-789X eISSN: 2306-3459 DOI: 10.14254/2071-789X
Index PUBMS: f5512f57-a601-11e7-8f0e-080027f4daa0
Article information
Title: Boards’ Attributes and Company Performance: the Romanian Experience
Issue: Vol. 10, No 2, 2017
Published date: 06-2017 (print) / 06-2017 (online)
Journal: Economics & Sociology
ISSN: 2071-789X, eISSN: 2306-3459
Authors: Ovidiu-Niculae Bordean
Babeș-Bolyai University

Anca Borza
Babeș-Bolyai University
Keywords: board of directors, diversification strategy, corporate governance theories, Romania
DOI: 10.14254/2071-789X.2017/10-2/5
Index PUBMS: 1c1c7b81-004c-11e8-94c4-fa163e5d4f72
Language: English
Pages: 61-73 (13)
JEL classification: M12, M51

For a long period of time, researchers from the corporate governance field have been interested in finding out what drives companies’ performance. The present study identifies five attributes of boards – size, age, female representation, proportion of non-executive directors, and chairman-CEO duality – in an attempt to link these to diversification strategy and financial performance. These relations are investigated using archival sources of data for a sample of 56 publicly traded companies from an emerging economy. The results are consistent with other studies performed abroad and at the same time offer new theoretical and managerial perspectives on the issues analyzed. The findings offer some valuable insights into the decision of corporate diversification at both theoretical and managerial level. The results provide support for both managerial hegemony and agency theory. Board members have little involvement in the strategy-making process as this is most often an attribute of managers, where as the existence of more members without executive responsabilities is a determinat of superior company performance.


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