The impact of board independence and foreign ownership on financial and social performance of firms: evidence from the UAE

What is it about?

This study examines the impact of two different types of foreign ownership – by Arab and non-Arab investors on firms’ financial and social performance. It then goes on to investigate how the degree of board independence affects the relationship between these two types of foreign investors on firm performance. Results indicate that while Arab foreign ownership affects firms’ financial and social performance negatively, non-Arab foreign ownership does so, positively. Further tests indicate that board independence weakens the negative relationship between firm financial and social performance with foreign Arab ownership and deteriorate the relationship between firm financial and social performance and non-Arab foreign ownership.

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