Corporate Reputation: Do Board Characteristics Matter? Indian Evidence

Abstract Drawing inference from signalling theory, the study attempts to examine the relation between corporate governance and corporate reputation in the Indian context. There is hardly any study directly deciphering the impact of board attributes (like size and ownership pattern) on corporate reputation (taking market capitalisation as proxy) in India. Based on a sample of 403 Indian companies listed on the Bombay Stock Exchange (BSE), the results of panel regression indicate that board size and ownership pattern influence the assessment of a company’s reputation, which is in line with the findings of previous research on this issue in developed nations. It is also found that firms who allow access to institutional investors and those with larger boards exhibit better reputation. Overall, the findings of the current study support the proposition that board characteristics influence the formation of firm reputation by the business community. The study bears significant implications for corporate managers that along with improving financial performance, social performance and media visibility, they should give significant weightage to good governance and management quality (reflected through board attributes) to enhance firm reputation and gain competitive advantage over others.