About the "Shape" of the "Boardroom". A Structural Equation Model Indication in Support of Business Performances

Are the characteristics of the governing board of firms related to business results? Starting from this fundamental question we examine the case of the top capitalised companies listed on “Borsa Italiana” in the context of the recent late post-crisis. Following an integrated (agency and resource/stewardship) framework, we investigate whether the board’s qualities or major features can somehow affect corporate performance. After an early phase of the research involving several individual regressions (discarding the variables less ‘informative’ or ‘relevant’), a more advanced depth study was finally conducted to explore the relationships between the boardroom and performance indicators under a concurrent, comprehensive, structural model. In details, we adopt a SEM path approach (a variance-based model increasingly applied in business and social sciences), considering “performance” (ie, business results) and “organisational convexity” (as for the conceptualised shape of the boardroom) as the latent operationalised variables. We document a negative influence of the number of meetings and committees, independent ratio, age of CEO and CEO non duality, versus a positive influence of external offices and presence of women, enabling a new and partly counterintuitive understanding. In a nutshell, the latent variables of our structural analysis show to be negatively related: corporate performance is higher in presence of a less convexificated organisational shape of the boardroom, due to an allegedly efficiency-aimed synthesis and concentration of competencies, with a svelte and effective array. Ultimately, despite the difficulties and limitations (that require further tests and validation in future research), the paper tries to make efforts in developing new methodological approaches in corporate governance.