Board Characteristics And Behavior Of Empirical Research, The Impact On Corporate Performance

Management power of a corporation is typically centralized in a Board of Directors who establishes company policy and is elected by the stockholders. A good board structure reflects its efficiency of management in Modem Corporation. To increase efficiency in the management and the governance of a company, its structure is the main component. As for modern enterprise system, board has been being a research focus of financial. As a new governance mechanism, its governance efficiency, wether or not can develop effectively? Its function which it should have been?This article quotes non-financial institutions as examples, which started public offering in A stock market before Dec 31, 2002, take the data of 2005 as data window. Firstly, this research analyzes the present condition of the listed company board in China. Then gives the experimental analyzes from the board characteristics and activies such as board size, the proportion of independent director, board meeting frequency and duality. This paper adopt ROE,EPS,CROA to measure corporate performance and adopt ordinary least squares model to analyze the relationship between the board characteristic and corporate performance..Results show the correlation of the size of the board and the firm performance is not definite; the proportion of independent director is positively correlated with firm performance; the correlation of duality and the firm performance is not definite; the frequency of the board meeting is negatively correlated with firm performance. But except the duality and the frequency of the board meeting is sinaficantly correlated with firm performance, the results are all not significant. At the same time, when we devided the sample into two parts according to the proportion of the first number shareholder, we found that the degree of the correlation of the board characteristics and activies and the firm performance in the companies which the first number shareholder less than 50% is more profound than the others. These results demonstrate that the board system of listed firm is still imperfect, most of boards just are "rubber stamp". Practice shows there is a phenomenon of "weak board" in China.According to the above conclusions, this paper promote many suggestions to improve further proposes such as: standard the board size, improve and perfect the system of Independent Directors, improve the duality, enhance the efficiency of the board meeting and optimize the ownership of listed companies.The article is divided into four parts. The first section include the chapter one and two, they show us the outline of the article, and review the correlated research of it; the second section include the chakpter three, four and five, they put forward the hypothesis of the influence of the board characteristics and activies on the firm performance, then gives the theoritical research and experimental analyzes. The third section is chapter five, this paper put forward many suggestions according to the above conclusion.