Board Composition, Corporate Governance Quality, and Firm Value — Panel Evidence from NSE-Listed Indian Companies
Author(s): Arun Venkatesh, Divya Krishnaswamy, Rohit Malhotra
Affiliation: Department of Financial Studies, University of Delhi, Delhi, India, Faculty of Management Studies, Panjab University, Chandigarh, India
Page No: 53-56-
Volume issue & Publishing Year: Volume 3 , Issue 3, 2026/03/18
Journal: International Journal of Modern Engineering and Management | IJMEM
ISSN NO: 3048-8230
DOI:
Abstract:
Corporate governance has been at the forefront of Indian capital market regulation since the Clause 49 reforms of 2004, the Companies Act 2013, and SEBI's Listing Obligations and Disclosure Requirements (LODR) Regulations 2015 and their 2024 amendment. Yet empirical evidence on how governance quality translates into firm value in India's promoter-dominated ownership structure — where promoter groups control 51.8% of aggregate NSE 500 equity as of December 2024 — remains contested. This study employs a balanced panel dataset of 342 NSE-listed companies over 2016–2025, combining Tobin's Q and Market-to-Book ratio as firm value measures with a composite Corporate Governance Index (CGI) constructed from board composition, audit quality, disclosure transparency, and shareholder rights dimensions. Fixed-effects panel regression with instrumental variable (IV) correction for endogeneity identifies a significant positive CGI-Tobin's Q relationship (β=0.037, p<0.001), strengthened in the post-2022 BRSR mandatory disclosure period (β=0.044, p<0.001). Board independence and audit committee financial expertise account for 63% of the CGI-value relationship. Promoter concentration negatively moderates governance-value coupling (interaction β=-0.019, p<0.01), while foreign portfolio investor ownership positively moderates it (β=0.024, p<0.001). SEBI's 2024 LODR amendments — mandating risk management committee independence and enhanced RPT disclosures — are associated with a measurable incremental governance premium in early-adopter firms.
Keywords:
corporate governance, Tobin's Q, board independence, SEBI LODR 2024, BRSR, promoter concentration, FPI ownership, panel data, NSE, India, agency theory
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