We investigate the potential impact of board characteristics on firm performance. The research is based upon a sample of 35 Initial Public Offerings (IPOs) in Germany, Austria and Switzerland (DACH-countries) that were completed between 2008 and 2012. We study and compare different board characteristics (size, age, gender, education, committees, tenure, financial expertise, holdings and external mandates) of 166 directors at the time the firms went public. We further investigate potential relations between these board characteristics and subsequent firm performance (Tobin's Q, return on assets and return on equity) through correlation and simple linear regression analysis. According to our sample the vast majority of the analysed directors are highly educated, male and over 52 years old. Partially in line with our expectations and with previous research, board size, board tenure and age diversity appear to have a lagged positive relation to accounting-based measures of performance. Contrary to our expectations, we find somewhat contradicting results for our market-based measure of performance. We suggest extending the analysis to farther-reaching time periods as well as to other institutional contexts.
Board of Directors
Initial Public Offering (IPO)
contribution to scientific community
American Accounting Association 2014 Annual Meeting