Tan, Elena Chiew Yen and Lee, Whye Pin (2019) Analysing board characteristics with firm performance among Malaysia and Singapore shariah plcs. Final Year Project, UTAR.
Abstract
The purpose of this research is to determine if corporate governance mechanisms are more significant between Shariah PLCs in Malaysia or Singapore. Corporate governance mechanisms that adopted in this research are number of independent directors, independent chairman, CEO tenure, board size, number of women directors and foreign director. These mechanisms are applied to examine its relationship towards firm performance. The firm performance is measured by return on assets (ROA), return on equity (ROE) and Tobin’s Q. The samples used in this research are 25 Malaysian Shariah PLCs and 25 Singaporean Shariah PLCs in the period of 2013 to 2017. This research applied Panel Data Analysis to examine the overall 5 years results. There are 2 types of panel estimator approaches that can be implemented which are fixed effect and random effect. This research is also employed Multiple Linear Regression with the aim to examine the year to year relationship between corporate governance mechanisms, Malaysian and Singaporean Shariah PLCs’ performance. The results shown that independent chairman, CEO tenure and foreign director have no impact towards both countries. However, the other 3 independent variables are statically affecting the Singaporean Shariah PLCs’ performance. Number of independent directors has a significant and negative impact on ROA and ROE in Singapore and has no impact in Malaysia. Besides, board size only has positive and significant impact on ROA, ROE and Tobin’s Q in Singapore. While, number of women directors has significantly negatively impact on ROE and Tobin’s Q in Singapore.
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