The Empirical Study On The Relationship Between Board Characteristics And Corporate Competitiveness

With China’s rapid economic development and China’s increasingly openmarkets， China’s enterprises are suffering from fierce competition in themarket．Therefore，the improvement of the competitiveness of enterprises has avery practical significance in the survival and development of the enterprise．Thefactors of affecting the competitiveness of enterprises are many，corporategovernance as the institutional basis of the good operation of the enterprise，plays a important role in the formation and enhancement the competitiveness ofenterprises．Board governance is the core of corporate governance，the Boardplay its role or not，which will directly affect the normal operation anddevelopment of the enterprise，thus affecting the maintence and enhancement ofthe competitiveness of enterprises．This paper studies the relationship between the governance characteristicsof the board and the competitiveness of the enterprises． Based on theprincipal-agent theory，resource dependency theory，fiduciary duty theory as aguide，and propose the hypothesis，taking the listed companies for the iron andsteel industry in three years from2008to2010for the study sample to buildmodel to empirically test the relationship between board characteristics and thecompetitiveness of enterprises．The paper determines the competitiveness of enterprises evaluation systemon the basis of previous research from a financial point of view，using factoranalysis to evaluate the competitiveness of enterprises， taking thecompetitiveness of enterprises composite score as explanatory variables， selecting the size of the Board，the number of the Board of Directorsthe specialcommittee，the proportion of independent directors，the number of boardmeetings，directors’ remuneration，the stake of the directors and the status of theboard of directors set as the explanatory variable to build a Board governancecharacteristics and the competitiveness of enterprises multivariate regressionmodel，the paper analysises the results and summarizes the relationship betweenBoard governance characteristics and the competitiveness of enterprises．Thispaper finds that Board governance characteristics affect the competitiveness ofenterprises through empirical research．（1）the board size and competitiveness ofenterprises have a significant negative correlation；（2）the special committee ofthe Board of Directors and the competitiveness of enterprises are positivelycorrelated，but not significantly；（3）the proportion of independent directors andthe competitiveness of enterprises are positively correlated，but not statisticallysignificant；（4）the number of board meetings and the competitiveness ofenterprises have a significant negative correlation；（5）the directors’ remunerationand the competitiveness of enterprises are significant positive correlation，thestake of board members and the competitiveness of enterprises are positivecorrelation；（6）the board leadership structure and competitiveness of enterprisesis negatively correlated．The research finds the board of directors system of the listed company’s inChina’s iron&steel industry needs to be further improved，the role of boardgovernance to improve the competitiveness of enterprises，there is further roomfor improvement．Based on the empirical findings of the relationship between theBoard Governance characteristics and competitiveness of enterprises，from agovernance point of view of the board，this paper gives some suggestions to helpthe enterprises continue to enhance their competitiveness．The suggestions are asfollows：determine the reasonable size of the board；optimize the organizationalstructure of the board of directors，and play the governance role of the specialcommittee；increase the proportion of independent directors，and play thegovernance role of the independence of the board of directors；improve theoperating mechanism of the board of directors and the efficiency of themeeting of the board decision；improve directors’ incentives，and strengthen theconstraints of the Directors． This innovation is that the paper has conducted a comprehensive analysis onthe governance characteristics of the board of directors of listed companies inChina’s steel industry and empirically research on the relationship betweengovernance characteristics of the board of directors and enterprisecompetitiveness in the listed companies of China’s steel industry．...