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Corporate Governance and Board Effectiveness in Maritime Firms

Author

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  • Trond RandØy

    (School of Business and Economics, Agder University College, School of Management, Serviceboks 422, 4604 Kristiansand, Norway and Agder Research Foundation, Norway.)

  • Jon Down

    (College of Business, Bexell Hall 200, Oregon State University, Corvallis, OR 97331, USA)

  • Janinge Jenssen

    (School of Business and Economics, Agder University College, School of Management, Serviceboks 422, 4604 Kristiansand, Norway and Agder Research Foundation, Norway.)

Abstract

This paper examines the financial performance effect of three corporate governance mechanisms: (i) founding family CEO, (ii) board ownership, and (iii) board independence. The developed hypotheses are tested using multivariate ordinary least-squares regression on a 3-year sample of 32 publicly traded maritime firms from Norway and Sweden, and compared to the results of the same hypotheses tested on a sample of 96 manufacturing firms. This study concludes that maritime firms with a founding family CEO have better financial performance than maritime firms with a non-founding family CEO. Support was also found for the hypothesis that a high level of board independence enhances profitability in maritime firms. Contrary to agency theory predictions, no significant relation was found between the level of board ownership and firm profitability in maritime firms, although board ownership control was significant in the sample of manufacturing firms. Maritime Economics & Logistics (2003) 5, 40–54. doi:10.1057/palgrave.mel.9100059

Suggested Citation

  • Trond RandØy & Jon Down & Janinge Jenssen, 2003. "Corporate Governance and Board Effectiveness in Maritime Firms," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 5(1), pages 40-54, March.
    • Handle: RePEc:pal:marecl:v:5:y:2003:i:1:p:40-54
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    Cited by:

    1. Alexandridis, George & Kavussanos, Manolis G. & Kim, Chi Y. & Tsouknidis, Dimitris A. & Visvikis, Ilias D., 2018. "A survey of shipping finance research: Setting the future research agenda," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 115(C), pages 164-212.
    2. Theodore Syriopoulos & Michael Tsatsaronis, 2012. "Corporate Governance Mechanisms and Financial Performance: CEO Duality in Shipping Firms," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 2(1), pages 1-30, June.
    3. Grace W.Y. Wang & Su-Han Woo & Joan Mileski, 2014. "The relative efficiency and financial risk assessment of shipping companies," Maritime Policy & Management, Taylor & Francis Journals, vol. 41(7), pages 651-666, December.
    4. Andreou, Panayiotis C. & Louca, Christodoulos & Panayides, Photis M., 2014. "Corporate governance, financial management decisions and firm performance: Evidence from the maritime industry," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 63(C), pages 59-78.
    5. Hyo-Won Kang & Grace W Y Wang & Hee-Seok Bang & Su-Han Woo, 2016. "Economic performance and corporate financial management of shipping firms," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 18(3), pages 317-330, September.
    6. Syriopoulos, Theodore C., 2007. "Chapter 6 Financing Greek Shipping: Modern Instruments, Methods and Markets," Research in Transportation Economics, Elsevier, vol. 21(1), pages 171-219, January.
    7. Akbar, Muhammad & Hussain, Shahzad & Ahmad, Tanveer & Hassan, Shoib, 2020. "Corporate Governance and Firm Performance in Pakistan: Dynamic Panel Estimation," CAFE Working Papers 6, Centre for Accountancy, Finance and Economics (CAFE), Birmingham City Business School, Birmingham City University.

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