Exploring the Relationship Between Board structure and Firm Performance using Meta-Analysis: Moderating Role of Firm Age and Firm Size

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The current research on Corporate Governance (CG) focused mainly on the linkage between board structure and Firm Performance (FP). This meta-analysis aimed to examine the connection between board structure and financial performance, as well as the moderating impact of firm age and size on the link between board structure and performance. A set of 228 effect sizes reported in 50 research studies published between 2015 and 2020 in 47 peer-reviewed publications, exploring board and performance correlations across 22 nations, was analyzed by using the meta-analysis approach proposed by Hedges and Olkin (2014). The analyses were performed in two stages. Firstly, the key effect of board characteristics was determined on FP and was checked for effect size heterogeneity across primary studies. Afterwards, the moderating effect of firm-specific characteristics was explored on this relationship. The results of this meta-analysis revealed that the impact of board structure on FP was influenced by the age and size of the firm. The findings specifically indicated that as compared to older and larger firms, younger and smaller enterprises exhibited a stronger effect of board structure on FP. Additionally, the study also explored particular board structure traits that, depending on firm age and size, had distinctive effects on company performance. Only empirical studies reporting correlation coefficients and regression coefficients as the effect sizes were included in the current research. Subgroup analysis was not performed due to limited time and resources. The current research added to the body of knowledge by carefully examining the findings of previously published studies and by proposing a single statistical value that represents the significant role of the board in FP. Moreover, the study also provided valuable insights that may help the regulators, Board of Directors (BODs), and Chief Executive Officers (CEOs) to make informed decisions in order to improve CG practices and FP.