Impact of ownership structure and board independence on corporate performance: Empirical evidence from Pakistani listed firms

Abstract

This study investigates the relationship between ownership structure, board independence and firm performance of eighty listed Pakistani firms for the period 2005-2009. Performance is appraise with the help of market based and accounting based performance measures. Market based measures of performance, namely, Marris ratio and Tobin"s Q, as well as accounting based measures, namely, ROA and ROE are employed to measure firm performace. Our regression estimates reveal a significant positive effect of board size on both market based and accounting based performance measures and significant negative effect of insider ownership on ROA, meanwhile board independence has significant positive impact on market based performance measures.