Board independence and firm performance: The moderating effect of ownership concentration and shareholder protection

Abstract: This research studies the moderating effect of ownership concentration and the strength of investor protection on the relationship between the level of board independence, as measured by the number of non-executive directors in relation to total number of directors and the firm performance. Using a sample of 9018 observations on all non-financial publicly listed firmsin 27 OECD countries between the year 2012 and 2015. The findings show a positive correlation between board independence and firm performancein all regression models. Furthermore, I find the negative moderating effect on both shareholder concentration and investor protection on the main relationship.