The Influence of Board and Executive Attributes on Firm Performance: Insights from the Thai Service Sector
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Abstract
This study empirically investigates the influence of board and executive characteristics—specifically size, gender diversity, and role duality—on the financial performance (Return on Assets, ROA) of service companies listed on the Stock Exchange of Thailand (SET). A core objective was to assess whether these relationships differ significantly based on a firm's Environmental, Social, and Governance (ESG) rating status, a factor whose moderating role is theoretically developed herein. The analysis utilized multiple linear regression on a pooled dataset of 234 firm-year observations from 2021-2023. Key findings include a statistically significant negative relationship (p<0.01) between the proportion of female members (gender diversity) and ROA across all firm groups. This result contrasts with some international research and warrants further exploration into unique Thai institutional or sector-specific dynamics. Conversely, a significant positive association (p<0.05) between role duality and ROA was observed exclusively within the ESG-rated company subgroup, suggesting that concentrated Leadership roles may enhance governance efficiency and strategic alignment specifically within organizations committed to sustainability principles. The relationship between board/executive size and ROA was consistently not statistically significant (p>0.05). These findings provide clear evidence that board and executive characteristics exert significant and context-dependent influences on ROA, offering specific, actionable insights for shareholders, investors, and corporate leaders in strategically designing governance structures, particularly for those pursuing ESG integration.
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