A Study of the Relationship Between Corporate Governance and Business Performance for Taiwan Construction Industry

• Main Authors: CHEN, PO-CHING, 陳寶瓊
• Other Authors: YiHao Lai
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/69029104170827779138

碩士 === 大葉大學 === 管理學院碩士在職專班 === 102 === Abstract This study aims to investigate the relationship between corporate governance and business performance among construction companies in Taiwan. 69 companies in construction listed on the Taiwan Stock Exchange (2007 – 2011) are selected as the research sample, and a multiple regression analysis is used to explore impacts on business performance in terms of seven governance variables within two dimensions based on their ownership structures and Board characteristics. According to the results, proportions of shares owned by directors, supervisors, major shareholders, and Board chairman and concurrently general manager are found to be positively correlated with business performance; the size of Board and the pledge ratio of shares adopted by directors and supervisors are found to be negatively correlated with business performance; proportions of shares owned by managers and institutional investors are found to be both positively and negatively correlated with business performance. Hence, the larger the size of Board the more the number of people, making it difficult for the Board to reach consensus on issues, which leads to a series of changes in strategies due to inability to adapt to the environment; also, the higher the pledge ratio of shares adopted by directors and supervisors the more likely funds will be obtained via improper approaches, and such individual factors among directors and supervisors will lead to poor business efficiency as well as incapable management, and furthermore, a financial crisis, which will cause infringement on rights and interests of shareholders and poor business performance. Key words： Corporate Governance, Business Performance, Ownership Structure, Board Characteristics