Volume 3, Issue 3, September 2018, Page: 16-20
The Relationship Between Board Size and CEO Duality and Firm Performance: Evidence from Jordan
Almontaser Abdallah Mohammad Qadorah, Othman Yeop Abdullah Graduate School of Business, Universiti Utara Malaysia, Sintok, Malaysia
Faudziah Hanim Bt Fadzil, Othman Yeop Abdullah Graduate School of Business, Universiti Utara Malaysia, Sintok, Malaysia
Received: Sep. 16, 2018;       Accepted: Oct. 12, 2018;       Published: Nov. 7, 2018
DOI: 10.11648/j.ijafrm.20180303.11      View  563      Downloads  128
Abstract
This study investigates the relationship between board of directors’ characteristics namely (board size and CEO duality) and firm performance among Jordanian listed firms. Firm performance is measured using return on assets (ROA). Due to limited studies regarding corporate governance practices and firm performance has been done in developing countries like Jordan. Importantly, these studies have also been limited in their scope due to restricted and particularized focus on factors hindering firm performance in the industrial sector of Jordan. This study covers industrial listed firms on the Amman Stock Exchange, Jordan for the year 2013 as a sample. Multiple regression analysis is used to test the hypotheses and to examine the relationship between board of directors’ characteristics namely (board size and CEO duality) and firm performance. The findings showed that board size is significantly and positively related to ROA. On the other hand, CEO duality is significantly and negatively related to ROA. These results indicate that corporate governance plays a vital role in enhancing firm performance and reducing agency conflict. Further, regulator bodies in Jordan should increase the effectiveness of corporate governance in industrial Jordanian firms in order to enhance the quality of financial reports. In addition, this study opens up avenues for more studies on firm performance not only in Jordan, but also in other countries where this area of study is lacking.
Keywords
Corporate Governance, Board of Directors Size, CEO Duality, Firm Financial Performance
To cite this article
Almontaser Abdallah Mohammad Qadorah, Faudziah Hanim Bt Fadzil, The Relationship Between Board Size and CEO Duality and Firm Performance: Evidence from Jordan, International Journal of Accounting, Finance and Risk Management. Vol. 3, No. 3, 2018, pp. 16-20. doi: 10.11648/j.ijafrm.20180303.11
Copyright
Copyright © 2018 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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