Empirical Research On The Effects Of The Characteristics Of The Board Of Directors On The Company Performance

Company management has been extensively discussed all over the world since the21st century. Within the wave of company governance globalization, corporation governance has become the main factor for the modern company to raising the core competitiveness of their enterprise. In the view of the reform of companies all over the world, the internal corporate governance are going through the institutional change from the centralism of general meeting of shareholders to the centralism of the board of directors. The institutional change of the board of directors plays an important role in the company governance and reformation in most of the market economy countries in the world in the most recent decade. Thus complete the institutions of the board of directors will enhance the efficiency of company governance, and further, this will boost the company performance. With China’s reform and open up, our economic has been among the list of big economic power of the world. Comparing with other economic power in the world, Chinese economy has a unique Sinicism economic characteristic, this economic characteristic embodied in the fact that China has become one of the economic giant of the world with the biggest amount of state-owned assets and biggest proportion of state-owned economy. Thus in our country, State-owned economy is the most important component of national economy, not only because big quantity, but also because intensive distribution in important industry, which plays an important role in the national economy. As the main carrier of the state-owned economy, state-owned enterprises will certainly account for absolute quantity and economic strength superiority in the market of the listed company. Respecting the above-mentioned facts, this paper mainly does empirical analysis on the characteristics of board of directors in state-owned enterprise and corporate performance.We can divide our paper into three parts:theoretical summarize, hypothesis and empirical research. The remainder of this paper is organized as follows. First we analysis theoretically the way board characteristics impact corporate performance in state-owned corporate based on describing the state-of-the-art works done by scholars both at home and abroad.Then we uses the data of2008-2010non-financial state-owned listed companies in Shanghai and Shenzhen as samples, uses return on equity as the index to measure the company performance, along with this, because it is unreliable to consider only the financial index to judge the company performance given the characteristics of the state-owned corporate, our paper selected the financial index as well as the social contribution of a corporate as the measurement of company performance.Furthermore, we select variables according to characteristics of board of directors, then presented regression analysis for the size of the Board of directors, the board compensation, the times of the board of directors’meetings, and for percentage of independent directors, board of directors’characteristics and the company performance. This kind of analysis concretely represented in the following aspects:the scale of the board of the directors of state-owned listed companies has a positive correlation separately with net assets income rate and social contributions of a corporate; there is no relationship between net assets income rate and the director compensation, while it represented negative correlation between the director compensation and the social contributions of a corporate; research shows that there is a negative correlation between the net assets income rate and the proportion of independent directors, but the proportion of independent directors and the contributions of a corporate is uncorrelated; times of the meetings of board of directors and the net assets income rate are negatively correlated, the times of the meetings of the board of directors and the contributions of a corporate are also negatively correlated.Finally, according to the results of empirical research we conclude the research and proposed suggestions for the financial policy.