The Impact of Corporate Governance on Financial Performance of the Pharmaceutical Industry in Pakistan
Ph.D. Scholar, Qurtuba University
The main purpose of this paper is to investigate the relationship between corporate governance and financial performance of the pharmaceutical industry in Pakistan. The study examined corporate governance dimensions in terms of board composition, board size, board education, board experience and CEO duality, while financial performance is measured in terms of ROA, ROS. The findings of this study indicate that composition of board, size of the board, board education and board experience is strongly associated with firm financial performance. Moreover, it is also found that duality of the chief executive officer is negatively linked with return on sales and return on asset of the firms. Hence, duality of the chief executive officer has negatively affected the financial performance of the pharmaceutical firm in Pakistan. Whereas, composition of board, size of the board and board experience have positive impact on the financial performance of the pharmaceutical firm in Pakistan.
Keywords: Corporate Governance, financial performance, ROA, ROS, pharmaceutical firms