The Effectiveness and Independence of Supervisory Board: Evidence from China 2000-2009

Abstract

This paper examines the effectiveness and the independence board by using all firms listed on the main board of China from 2000 to 2009. I find significant inverse relationship between supervisory board size and firm performance. In addition, I find evidence of a significant nonmonotonic relationship, Tobin's Q and ROA first decline and then increase as the independence of supervisory board rises. The results are consistent with prior studies.