Board commitment, continuous education program and firm performance: A law and governance context

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Abstract

The majority of worldwide corporate governance codes mandate that directors allocate an adequate amount of time to fulfil their responsibilities and consistently enhance their knowledge and abilities through continuous education programs. These two factors are crucial in propelling the organisation towards higher levels of success and satisfying the needs of the stakeholders. This research aims to analyse the impact of board commitment and their access to education on firm performance. After analysing the annual reports of Malaysian public listed companies, this study does not find any conclusive evidence to support earlier research that highlights the advantages of having a director who is committed to the firm and has strong access to educational programs. This might be attributed to the challenge of quantifying the influence of board commitment and their educational opportunities, which may manifest over long periods of time, therefore, making it difficult to capture instant or short-term effects. In addition to assisting policymakers and the company in effectively guiding and monitoring their governance commitment, this study contributes by highlighting the significance of board commitment and board access to education in influencing the performance of the company. Additionally, it contributes to the enhancement of education platforms that are specifically designed for the board of directors.

Keywords: Corporate Governance, Board Commitment, CPD, Transparency, Corporate Disclosure, Financial Reporting

Authors’ individual contribution: Conceptualization — A.S.A.P.S. and Z.I.; Methodology — A.S.A.P.S., Z.I., and M.S.; Formal Analysis — A.S.A.P.S., Z.I., and M.S.; Investigation — A.S.A.P.S.; Data Curation — A.S.A.P.S.; Writing — Original Draft — A.S.A.P.S.; Writing — Review & Editing — Z.I. and M.S.; Visualization — A.S.A.P.S. and Z.I.; Supervision — Z.I. and M.S.; Project Administration — A.S.A.P.S.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: G3, M12, M14, M20, M48

Received: 21.03.2024
Accepted: 06.08.2024
Published online: 09.08.2024

How to cite this paper: Salin, A. S. A. P., Ismail, Z., & Smith, M. (2024). Board commitment, continuous education program and firm performance: A law and governance context. Corporate Law & Governance Review, 6(2), 107–115. https://doi.org/10.22495/clgrv6i2p10