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Corporate performance: does board independence matter? – Indian evidence

Arunima Haldar (Department of Finance, SP Jain Institute of Management and Research, Mumbai, India)
Reeta Shah (Indian Institute of Technology Bombay, Mumbai, India)
S.V.D. Nageswara Rao (School of Management, Indian Institute of Technology Bombay, Mumbai, India)
Peter Stokes (Leicester Castle Business School, De Montfort University, Leicester, UK)
Dilek Demirbas (Istanbul University, Fatih, Turkey)
Ali Dardour (Department of Accounting, Accounting Management and Audit, Kedge Business School Bordeaux, Talence, France)

International Journal of Organizational Analysis

ISSN: 1934-8835

Article publication date: 12 March 2018




The purpose of this paper is to examine the effect of the presence of independent board directors on financial performance in India.


This study used panel regression models on large listed Indian firms to investigate the impact on financial performance owing to the presence of independent directors.


The findings suggest that independent board directors in Indian contexts do not significantly affect financial performance.

Practical implications

This study has implications for the formulation of regulation related to appointment of independent directors and the extent of their representation on the board for them to be effective.

Social implications

The proportion of independent directors on the board of the firm is influenced by the trade-off between the cost of having independent directors on the board versus the benefits to the firm and society.


The impact of the presence of an independent director on financial performance in highly concentrated ownership remains ambiguous.



Haldar, A., Shah, R., Nageswara Rao, S.V.D., Stokes, P., Demirbas, D. and Dardour, A. (2018), "Corporate performance: does board independence matter? – Indian evidence", International Journal of Organizational Analysis, Vol. 26 No. 1, pp. 185-200.



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