Does Corporate Governance Influences Corporate Financial Performance? Empirical Evidences for the Companies Listed on US Markets

摘要

The purpose of the present paper is that of researching the relationship between corporate governance and financial performance, on a sample of 51 companies, mainly from the technology area, listed at NASDAQ and component of the Dow Jones index, during the period 2000-2013. The financial performance has been proxied through return on assets (ROA), return on equity (ROE), return on the invested capital (ROIC), and Tobin’s Q ratio (Q). As variables for the corporate governance there have been considered: the characteristics of the board of directors (independence, size, Advisory Committees, and gender diversity); the shareholder structure (the shares of institutional investors and those of CEO); the characteristics of CEO (tenure, age, and duality); the remuneration of CEO (base salary, bonuses, packages with stocks). The estimation techniques used in the empirical analysis have been multivariate regression models based on the method of generalized least squares (GLS), the correction of standard errors for heteroskedasticity using the method of White, and the fixed-effects (FE). The results obtained have highlighted a mixed influence of the corporate governance variables on financial performance (board size, share of women on the boards, the independence of the board), the relationships being influenced also by the perception of the stakeholders. We concluded a positive relationship between ROE and the remuneration of CEO in bonuses, as well as a negative relationship between Tobin’s Q ratio and the remuneration of CEO through stocks at the company they manage. The paper highlights, as novelty, elements from behavioral finance in the economic interpretation of the results, following their explanation also from the human nature perspective.