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Board Characteristics, Ownership Concentration and the Financial Performance of European Listed Insurance Companies: New Empirical Evidence

Author

Listed:
  • Graţiela Georgiana NOJA

    (Department of Marketing and International Economic Relations, East European Center for Research in Economics and Business, West University of Timişoara, Timişoara, Romania)

  • Gheorghe HURDUZEU

    (Department of International Business and Economics, Bucharest University of Economic Studies, Bucharest, Romania. Institute of Agricultural Economics, Romanian Academy, Bucharest, Romania.)

  • Mirela CRISTEA

    (Department of Finance, Banking and Economic Analysis, University of Craiova, Craiova, Romania.)

  • Flavia BARNA

    (Department of Finance, West University of Timişoara, Timişoara, Romania.)

  • Miruna-Lucia NĂCHESCU

    (Department of Finance, West University of Timişoara, Timişoara, Romania.)

  • Camelia GAVRILESCU

    (Institute of Agricultural Economics, Romanian Academy, Bucharest, Romania.)

Abstract

The research aims to appraise the interplay between several features of corporate governance and company financial results, as well as the impact of board characteristics and ownership credentials on the size and performance of European companies operating in insurance, reinsurance, and pension funding. Data was extracted from the Orbis database for a newly compiled sample of 6,096 active firms in 2015-2022 (according to the last available year). The methodological approach was based on robust regression with Huber and biweight iterations and network analysis with Gaussian and Mixed-Markov graphical models. Main results revealed notable positive impacts of the number of directors, managers, and shareholders on firms’ financial results. Instead, the ownership concentration, namely the board independence, negatively influenced the performance of the European insurance companies, with a less significant impact on their operating revenue and profitability.

Suggested Citation

  • Graţiela Georgiana NOJA & Gheorghe HURDUZEU & Mirela CRISTEA & Flavia BARNA & Miruna-Lucia NĂCHESCU & Camelia GAVRILESCU, 2023. "Board Characteristics, Ownership Concentration and the Financial Performance of European Listed Insurance Companies: New Empirical Evidence," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 25-42, December.
    • Handle: RePEc:rjr:romjef:v::y:2023:i:4:p:25-42
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    References listed on IDEAS

    as
    1. Petroni, Kathy Ruby, 1992. "Optimistic reporting in the property- casualty insurance industry," Journal of Accounting and Economics, Elsevier, vol. 15(4), pages 485-508, December.
    2. Emine Öner Kaya, 2015. "The Effects of Firm-Specific Factors on the Profitability of Non-Life Insurance Companies in Turkey," IJFS, MDPI, vol. 3(4), pages 1-20, October.
    3. Han-Bin KANG & Hsuling CHANG & Tsangyao CHANG, 2022. "Catastrophe Reinsurance Pricing -Modification of Dynamic Asset-Liability Management," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 5-20, December.
    4. Bayelign Abebe Zelalem & Ayalew Ali Abebe & Sitotaw Wodajo Bezabih, 2022. "Corporate governance and financial performance in the emerging economy: The case of Ethiopian insurance companies," Cogent Economics & Finance, Taylor & Francis Journals, vol. 10(1), pages 2117117-211, December.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    corporate governance; ownership concentration; revenues; financial performance; insurance; econometric modelling;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

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