We investigate two-tier supervisory board characteristics and relations versus financial performance by using a unique sample of Danish non-financial listed companies. We investigate a positive association between corporate performance measures (ROA and Tobin’s Q) and board diversity using some structural board characteristics. Our main analyses are based on fixed effects regression analyses to evaluate the relationships between performance and board size, structure, independence, and other board characteristics. Interestingly, we find that although gender is not the only relevant diversity dimension, it is the one with singular largest impact on performance. In addition, the results show that the two-tier based supervisory board composition and diversity information is useful to improve our understanding of what drives performance, and it contributes to a better understanding of the circumstantial relationship between board structures and financial performance. The two-tier setting extends the traditional unitary board characteristics issues to relationships between three parties, namely the supervisory board, the management board, and the stockholders, which extends our knowledge on the traditional monitoring and controlling tasks performed by the supervisory board, and thus on the supervisory board’s contribution to corporate governance and performance.
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