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Uncertain Supply Chain Management

ISSN 2291-6830 (Online) - ISSN 2291-6822 (Print)
Quarterly Publication
Volume 12 Issue 3 pp. 1441-1450 , 2024

Does board of directors affect financial performance? A study of the Jordanian companies Pages 1441-1450 Right click to download the paper Download PDF

Authors: Bilal Nayef Zureigat, Amer Mohd Al Hazimeh, Rafat Batayneh, Nahed Habis Alrawashedh

DOI: 10.5267/j.uscm.2024.4.007

Keywords: Accounting, Corporate governance, Agency theory, Organization performance, Amman stock exchange

Abstract: The purpose of this study was to examine the impact of the board of directors on the economic performance of Jordanian companies listed on the Amman stock exchange (ASE) by measuring the board of administrators using a variety of indicators, including board size, board independence, and CEO duality. Economic performance is measured by going back on property and returning on equity. During the study period (2015–2020), 186 industrial corporations were examined. The study found that the indexed organizations at ASE during the years 2015–2020 showed full-size financial overall performance in accordance with Jordan's improving understanding of and application of the board of directors' traits. This study found that board size and independence had a substantial influence on financial performance. Based on the findings, the study recommends that the codes be evaluated on a regular basis and that corporations be instructed to examine corporate governance principles through legislation and regulations to encourage enterprises to follow these rules. Furthermore, board members' experience, devotion, and independence are reviewed on an ongoing basis. Stock exchanges should also conduct seminars and workshops for company managers and decision-makers to enhance understanding of effective corporate governance, especially its importance. The correlation coefficient shows a negative relationship between Board size and Board Independence with ROA, while board size and CEO duality are positive correlation with ROE. On The other side the regressions test of the effect of the variables on financial performance ratios (ROA and ROE) shows that there is a significant effect of board size and board independence on ROA and ROE. While CEO duality has an insignificant effect on both ratios ROA and ROE.

How to cite this paper
Zureigat, B., Hazimeh, A., Batayneh, R & Alrawashedh, N. (2024). Does board of directors affect financial performance? A study of the Jordanian companies.Uncertain Supply Chain Management, 12(3), 1441-1450.

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Journal: Uncertain Supply Chain Management | Year: 2024 | Volume: 12 | Issue: 3 | Views: 885 | Reviews: 0

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