The Effect of Board Characteristics on Financial Performance: Case of Erbil

Authors

  • Hawkar Anwer Hamad Department of Business Administration, College of Administration and Economics, Lebanese French University, Erbil, Kurdistan Region, Iraq
  • Akar Omar Mhammad Department of Accounting, College of Administration and Economics, Lebanese French University, Erbil, Kurdistan Region, Iraq
  • Wafa Rashid Mahmood Department of Accounting, College of Administration and Economics, Lebanese French University, Erbil, Kurdistan Region, Iraq
  • Hero Hassan Khzir Department of Accounting, College of Administration and Economics, Lebanese French University, Erbil, Kurdistan Region, Iraq

DOI:

https://doi.org/10.25212/lfu.qzj.6.4.39

Keywords:

board independence, board ownership, board meetings, financial performance, board characteristics.

Abstract

This study investigated the effect of board characteristics on financial performance. The study examined board ownership, board independence and board meetings as the independent variables of the study and Return on Assets as the dependent variable which indicated the financial performance of the organization. The data was collected from companies from different industries spanning the years 2005 to 2016 From Iraqi Securities Commission and Stock Exchange in Iraq. The study was based on a deductive approach and a panel data but cross-sectional design. The data employed the panel data and multiple regression analysis. The data employed the panel data and multiple regression analysis with the aid of Microsoft Excel and Statistical Package for Social Sciences (SPSS). The results revealed a positive relationship between board independence and board ownership with financial performance. However, increase in board meetings was found to negatively affect the company’s Return on Assets. The paper recommended that the management of listed companies maintain having more non-executive directors and independent directors with ownership as this enhanced objectivity and ensured alignment of interests between shareholders and the directors.

Downloads

Download data is not yet available.

References

Afzalur Rashid, (2018). Board independence and firm performance: Evidence from Bangladesh, Future Business Journal, Volume 4, Issue 1, Pages 34-49,

Akinyomi John (2013). Impact of Board Structure on Corporate Financial Performance. International Journal of Research in Commerce, IT and Management. 3. 135-139.

Akpan, Eden, Okon (2015). Corporate board meetings and company performance: empirical evidence from Nigerian quoted companies

Al-Daoud, Khaleel & Saidin, Siti & Abidin, Shamharir. (2016). Board meeting and firm performance: Evidence from the Amman stock exchange. Corporate Board: role, duties and composition. 12. 10.22495/cbv12i2art1.

Al-Matari, Ebrahim & Al-Swidi, Abdullah & Hanim, Faudziah. (2014). The Effect of Board of Directors Characteristics, Audit Committee Characteristics and Executive Committee Characteristics on Firm Performance in Oman: An Empirical Study. Asian Social Science. 10. 10.5539/ass.v10n11p149.

Almontaser Abdallah Mohammad Qadorah, Faudziah Hanim Bt Fadzil (2018). The Effect of Board Independence and Board Meeting on Firm Performance: Evidence from Jordan, Journal of Finance and Accounting. Vol. 6, No. 5, pp. 105-109

Al-Saidi, M. (2020), "Board independence and firm performance: evidence from Kuwait", International Journal of Law and Management, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/IJLMA-06-2019-0145

Aryani, Anni Y, Doddy Setiawan, Isna Putri Rahmawati (2017). Board meeting and firm performance. Proceedings of International Conference on Economics ICE P438 – P444 ISBN 978-967-0521-99-2

Assenga, M.P., Aly, D.A., & Hussainey, K. (2018). The impact of board characteristics on the financial performance of Tanzanian firms. Corporate Governance, 18, 1089-1106..

Bird, R., Huang, P., & Lu, Y. (2018). Board independence and the variability of firm performance: Evidence from an exogenous regulatory shock. Australian Journal of Management, 43(1), 3–26.

Ali, D. J., & Hamad, H. A. (2021). The role of the cash flow statement to provide accounting information for the financial decision-making process:(Case study International Islamic Bank of Kurdistan in the year 2018). QALAAI ZANIST SCIENTIFIC JOURNAL, 6(2), 870-887.

Damilola Felix Eluyela, Olamide Oluwabusola Akintimehin, Wisdom Okere, Emmanuel Ozordi, Godswill Osagie Osuma, Simon Osiregbemhe Ilogho, Olufemi Adebayo Oladipo, (2018). Board meeting frequency and firm performance: examining the nexus in Nigerian deposit money banks, Heliyon,Volume 4, Issue 10

Doski, Shivan. (2015). The necessity of issuing a corporate governance code for the Kurdistan Region. journal of finance and accountancy. 18.

Fatah, N. A., Hamad, H. A., & Qader, K. S. (2021). The Role of Internal Audit on Financial Performance Under IIA Standards: A Survey Study of Selected Iraqi Banks. QALAAI ZANIST SCIENTIFIC JOURNAL, 6(2), 1028-1048.

Fatah, N. A. J. I. (2018). Factors affecting customers’ decision for taking out bank loans: A case of Sulaymaniyah city commercial banks (Doctoral dissertation, Master thesis of Near East University).

Johl, S. Kaur, B.J. Cooper (2015). Board characteristics and firm performance: evidence from Malaysian public listed firms. J. Econ. Bus. Manag., 3 (2), pp. 239-243

Kao, Mao-Feng & Hodgkinson, Iynn & Jaafar, Aziz. (2018). Ownership structure, board of directors and firm performance: evidence from Taiwan. Corporate Governance: The international journal of business in society. 19. 10.1108/CG-04-2018-0144.

Kakanda, M, M, B. Salim, S. Chandren (2016). Review of the relationship between board attributes and firm performance. Asian J. Finance Account., 8 (1), pp. 168-218

Khudhair, Dheyaa & Al-Zubaidi, Firas & Raji, Ali. (2019). The effect of board characteristics and audit committee characteristics on firm performance. Management Science Letters. 9. 271-282. 10.5267/j.msl.2018.11.012.

Liu, Yu & Miletkov, Mihail K. & Wei, Zuobao & Yang, Tina, 2015. "Board independence and firm performance in China," Journal of Corporate Finance, Elsevier, vol. 30(C), pages 223-244.

Meyer, Erik, JHvH de Wet (2013). The impact of board structure on the financial performance of listed South African companies. South Africa business journal. Volume 9, Issue 3, 2013

Ntim, Collins G. and Osei, Kofi A (2011). The Impact of Corporate Board Meetings on Corporate Performance in South Africa. African Review of Economics and Finance, Vol. 2, No. 2, pp.83-103

Palaniappan, G. (2017), "Determinants of corporate financial performance relating to board characteristics of corporate governance in Indian manufacturing industry: An empirical study", European Journal of Management and Business Economics, Vol. 26 No. 1, pp. 67-85

Syed Mohd Fuzi, Sharifah Faatihah & Abdul Halim, Syahrina & Khudzari, Julizaerma. (2016). Board Independence and Firm Performance. Procedia Economics and Finance. 37. 460-465. 10.1016/S2212-5671(16)30152-6.

Vefeas, N., (1999). Board Meeting Frequency and Firm Performance. Journal of Financial Economics 53: pp. 113-142.

Vu, Manh-Chiên & Phan, Thanh & Le, Nhu. (2017). Relationship between board ownership structure and firm financial performance in transitional economy: the Vietnamese transition. Research in International Business and Finance. 45. 10.1016/j.ribaf.2017.09.002.

Downloads

Published

2021-12-30

How to Cite

Hawkar Anwer Hamad, Akar Omar Mhammad, Wafa Rashid Mahmood, & Hero Hassan Khzir. (2021). The Effect of Board Characteristics on Financial Performance: Case of Erbil. QALAAI ZANIST JOURNAL, 6(4), 1031–1054. https://doi.org/10.25212/lfu.qzj.6.4.39

Issue

Section

Articles