Educated Professionals on Boards at Borsa Istanbul

Abstract

This study aims to investigate the educational backgrounds and professional expertise of the directors in firms quoted at Borsa Istanbul. The findings of the study reveal that, a higher percentage of directors with advanced degrees such as PhDs, serve on various board committees, and a higher percentage of them are assigned as independent directors to the boards, compared to directors of lower educational qualifications. In addition, the findings suggest that a higher percentage of directors, who are professional experts such as accounting experts, lawyers or professors, serve on various committees of the boards, and a higher percentage of them are assigned as independent directors to boards. In contrast, a lower percentage of professional experts with advanced educational degrees serve as CEOs or chairmen of boards. These results suggest that technical skills and knowledge of directors are valued highly by companies, whereas they are not as highly valued in top managerial positions.

Committees of Boards: An Event Study on an Emerging Market

“…A director with none of these professional backgrounds is defined as a non-expert director. A detailed discussion of benefits and costs associated with the existence of these professional on corporate boards can be found in Arioglu (2014).…”