The impact of Board Structure on Organizational Performance

Abstract

This study examines the relationship between board structure, such as board independence, board meetings, board compensation, and organizational performance. We use the maximum likelihood estimator, based on agency theory assumptions and cylindrical panel data, to examine three models of organizational performance. Using secondary data from 100 firms from 2016 to 2018, the results show that the independence of the board, board meetings, and board compensation are reflected clearly by the increased economic and equity performance of the organization. Our results include advanced explanations for market liquidity and shareholder portfolios.