The Effectiveness of Corporate Governance: Moderating Effect of Directorates’ Characteristics and TMT Turnover
This paper analyzes the effectiveness of corporate governance for public listed corporations from the perspective of sensitivity between executive turnover and corporation’s performance.It expands the definition of the effectiveness of corporate governance from two aspects. The paper examines how the characteristics of board of directors can affect the internal relationship between corporation’s performance and executive turnover, in order to test the effectiveness of China’s corporate governance with the listed companies’ data from 2005 to 2009.The research methodology and technical route is as following: evaluating the main effect of board character and performance to effectiveness; testing the interaction of directors’ board to effectiveness of corporate governance through MMR; analyzing moderate effect of controlling turnover and executive turnover. The empirical results show that there is the first kind of effectiveness on corporate governance in China, and an obvious inverted-U relationship is obvious between the size of board of directors and the probability of top management turnover.
KeywordsEffectiveness of Corporate Governance Top Management Team Turnover Directors’ Characteristics Moderated Multiple Regression
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