The Moderating Effect of Board Diversity on the Relationship between Executive Committee Characteristics and Firm Performance in Oman: Empirical Study

Abstract

This study focuses to achieve an important objective by examining the moderating effect of board diversity (foreign member on the executive committee and executive committee commitment) on the relationship between executive committee characteristics and firm performance in Omani companies excluding those categorized under the financial sector. The sampling covers two years, 2011 and 2012. This study used multiple regression and hierarchical multiple regression to analyze the association between independent, moderating and dependent variables. Based on the findings, a positive association between executive committee independence, executive committee meeting and firm performance is revealed although it is not significant. In the same context, the finding revealed a negative relationship between executive committee size and firm performance but not significant. Moreover, the board diversity moderated the relationship between executive committee characteristics and firm performance but the effect is not significant. Finally, this study offers recommendations for future researchers at the end.

Disclosure quality vis-à-vis disclosure quantity: Does audit committee matter in Omani financial institutions?

“…They are also less likely to be associated with companies and their management and are therefore considered to be independent (Van der Walt and Ingley 2003). Furthermore, foreign directors may bring much needed expertise and diversity, especially for companies that operate globally (Al-Matari et al 2014). Including foreign members on the boards would enhance the monitoring of management and induce them to act in the best interest of companies' current owners by disclosing high quality information to shareholders (Grassa et al 2020).…”

“…Haniffa and Cooke (2002), Barako et al (2006) and Grassa et al (2020) find that foreign board members have a positive impact on disclosure quantity. On the contrary, foreign directors are inherently costly -they may come from a different culture, speak a different language, be physically distant from the companies on whose boards they serve and may demand a higher level of compensation for the inconvenience of serving on the boards outside their own country of residence (Al-Matari et al 2014). This could lead them to damage FRQ due to not fully concentrating on the process of financial reporting and not being aware of the country context.…”

The Mediating Effect of Financial Performance on the Relationship between Shariah Supervisory Board Effectiveness, Intellectual Capital and Corporate Social Responsibility, of Islamic Banks in Gulf Cooperation Council Countries

“…Al-Matari, et al, 2014,Byrd & Hickman, 1992Chen et al, 2005;Drobetz et al, 2003;Gazor et al, 2013;Hossain et al, 2000;Ku Ismail & Abdul Karem, 2011;Jafari, 2013;Ping et al, 2006;Kujansivu & Lonnqvist, 2007;Mahoney & Roberts, 2002;Nazari & Herremans, 2007;Oliver & Porta, 2006;Rosenstein & Wyatt, 1990;Waddock & Graves, 1997;Yalama & Coskun, 2007) have used return on asset (ROA) and return on equity (ROE) as a measure of financial performance either alone or in addition to other measures in their studies of the influence of intellectual capital and corporate governance of firms Return on asset (ROA) is calculated by dividing net income by total assets whereas return on equity (ROE) is calculated by dividing net income by total equity.…”

“…Bank size is measured by natural logarithm of total assets (Al Matari et al, 2014;Khatab et al,2011), Bank age is measured by the time of listing or the time of incorporation (Shumway, 2001), while leverage is measured by the ratio of ratio of total liabilities to total assets (Al Matari et al, 2014). …”

Corporate social responsibility reporting and capital structure: Does board gender diversity mind in such association?

“…Scant past literature has checked the presence of female directors as moderator. In particular, Al Matari et al (2014) and Chin et al (2019) examined the moderating effect of female directors on the association between board committees and firm performance. Pucheta‐Martínez et al (2021a, 2021b) analysed what moderating role female directors on board played audit committees and CSR disclosure.…”