Board Leadership Structure and Firm Performance: Evidence from Listed Companies in Sri Lanka

Abstract

Corporate Governance as a mechanism helps to align management's goals with those of the
stakeholders that are to increase firm performance. The aim of this study is to identify the
relationship between board leadership structure and firm performance of listed companies in
Sri Lanka during the period of 2014-2016. The data was collected from the secondary data
sources and board leadership structure is measured by CEO duality. The sample of this study
consists of 100 firms listed in Colombo Stock Exchange based on market capitalization. For
the purpose of data analysis, Pearson‟s correlation analysis and independent sample t-test
were used to examine the hypotheses of this study. The findings reveal that board leadership
structure is positively correlated with firm performance in terms of Tobin‟s Q and there is no
significant difference in firm performance between CEO duality firms & non-duality firms.

Keywords: Corporate Governance, CEO Duality, Firm Performance, Tobin’s Q

JEL Classification: G30