Corporate board tenure and firm performance: Evidence from non-financial UK firms.
(2022) NEKN02 20221Department of Economics
- Abstract
- This study focuses on empirical estimation of the relationship between corporate board tenure and firm performance. Firm performance is measured by return on assets (ROA) and Tobin’s Q. The sample consists of 177 non-financial UK firms observed over 9 years (unbalanced panel). The relevant literature implies agency costs inherent in the modern corporation’s organisational structure as well as the relevance of board dependence and directors’ equity compensation with respect to the relationship between board tenure and firm performance. The study incorporates the fixed effects estimation method, lead-lag specifications, and a rich set of controls to address endogeneity concerns. The findings indicate that an extended director tenure... (More)
- This study focuses on empirical estimation of the relationship between corporate board tenure and firm performance. Firm performance is measured by return on assets (ROA) and Tobin’s Q. The sample consists of 177 non-financial UK firms observed over 9 years (unbalanced panel). The relevant literature implies agency costs inherent in the modern corporation’s organisational structure as well as the relevance of board dependence and directors’ equity compensation with respect to the relationship between board tenure and firm performance. The study incorporates the fixed effects estimation method, lead-lag specifications, and a rich set of controls to address endogeneity concerns. The findings indicate that an extended director tenure negatively affects firm performance (both ROA and Tobin’s Q). (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9084089
- author
- Lawrenz, Jakub LU
- supervisor
- organization
- course
- NEKN02 20221
- year
- 2022
- type
- H1 - Master's Degree (One Year)
- subject
- keywords
- corporate governance, agency theory, board tenure, firm performance, corporate finance
- language
- English
- id
- 9084089
- date added to LUP
- 2022-10-10 09:35:37
- date last changed
- 2022-10-10 09:35:37
@misc{9084089, abstract = {{This study focuses on empirical estimation of the relationship between corporate board tenure and firm performance. Firm performance is measured by return on assets (ROA) and Tobin’s Q. The sample consists of 177 non-financial UK firms observed over 9 years (unbalanced panel). The relevant literature implies agency costs inherent in the modern corporation’s organisational structure as well as the relevance of board dependence and directors’ equity compensation with respect to the relationship between board tenure and firm performance. The study incorporates the fixed effects estimation method, lead-lag specifications, and a rich set of controls to address endogeneity concerns. The findings indicate that an extended director tenure negatively affects firm performance (both ROA and Tobin’s Q).}}, author = {{Lawrenz, Jakub}}, language = {{eng}}, note = {{Student Paper}}, title = {{Corporate board tenure and firm performance: Evidence from non-financial UK firms.}}, year = {{2022}}, }