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This research aims to explore the influence of board structure on agency costs and shareholder wealth of companies listed in Sri Lanka. The results showed that the board structure related variables such as separate leadership structure, proportion of non-executive director on board, and female representation on boards appeared to be significant influence on agency costs. In addition to that, board size and presence of interlocking directorship on boards does not have any direct impact on agency costs. The board structure related variables such as board size, separate leadership structure, proportion of non-executive directors, proportion of women on boards, and presence of interlocking directorship could not have any direct impact on shareholder wealth of companies listed in Sri Lanka. These findings regarding to board structure, agency costs and shareholder wealth have important managerial implications that these results show which agency mitigation and shareholder wealth maximization mechanisms do not work effectively in listed companies in Sri Lanka.
About the author
Riyad Rooly is a Lecturer in Accountancy & Finance from South Eastern University of Sri Lanka. He holds BBA in Accounting and MAB in Finance. He is also Associate Certified Management Accountants of Sri Lanka. His research interest is in the field of banking & finance, corporate governance, and capital structure.
